WORLD / Asia-Pacific

Hyundai motor chairman Chung indicted
Updated: 2006-05-16 14:38

Prosecutors indicted Hyundai Motor Co. Chairman Chung Mong-koo on Tuesday in an embezzlement and slush fund scandal gripping South Korea's largest automaker.

Hyundai Motor Group head Chung Mong-Koo. The head of South Korea's largest carmaker has been indicted on charges of embezzlement and breach of trust following a month-old probe into a slush fund scandal, Yonhap news agency said.[Reuters]

Chung, 68, has been in custody since being arrested on April 28 on suspicion of embezzling about 100 billion won (US$106 million) in company money to create the slush fund and of breach of trust for allegedly incurring about 300 billion won (US$320 million) in damages to the company.

Kang Chan-woo, spokesman for the Supreme Prosecutors' Office, confirmed Chung's indictment, but didn't disclose the specific charges.

Hyundai is suspected of using the secret money, via at least two lobbyists, to seek favors from the government.

Chung's son, Eui-son, president of Kia Motors, an affiliate of Hyundai, has also been investigated, but wasn't indicted Tuesday. Media reports said prosecutors plan to indict the junior Chung later.

Hyundai is suspected of using the slush fund, via at least two lobbyists, to seek favors from the government.

The lobbyists have been arrested on charges of receiving money from Hyundai in exchange for promises to help it win construction approvals and permits, and other business favors.

It is unclear whether the lobbyists bribed government officials. It is illegal in South Korea to accept money in return for exercising influence.