The prosecution has indicted Daebang Construction and Gu Chan-woo, the representative of Daebang Construction and the eldest son of founder Gu Kyo-woon, on charges of violating the Fair Trade Act by funneling lucrative public land won through bidding to the founder's second-generation company without imprisonment.
Daebang Industrial Development, which received the lucrative public land from Daebang Construction, has also been referred to trial. Daebang Industrial Development is an unlisted company in which Gu Kyo-woon's daughter, Gu Su-jin, and his daughter-in-law hold 100% equity.
On the 21st, the Fair Trade Investigation Department of the Seoul Central District Prosecutors' Office (Director General Kim Yong-sik) stated that it has indicted Daebang Construction, Daebang Industrial Development, and representative Gu Chan-woo without imprisonment on charges of violating the Fair Trade Act.
The Fair Trade Commission imposed a penalty surcharge of 20.5 billion won and referred the case to the prosecution on the 25th of last month, claiming that Daebang Construction improperly supported a company where the second generation is the largest shareholder.
According to the Fair Trade Commission, Daebang Construction transferred six public lands secured through methods such as 'collusive bidding' to Daebang Industrial Development and its five subsidiaries from November 2014 to March 2020. Collusive bidding is an act where a construction company mobilizes multiple affiliates to engage in improper bidding to increase the possibility of winning public land bids.
The transferred public lands include those in Magok, Seoul; Jeonnam Innovation; Dongtan, Hwaseong, Gyeonggi; and Naepo, Chungnam, which Daebang Construction itself assessed as having 'ample development prospects with significant profits anticipated.'
Through such transfer activities, Daebang Industrial Development has secured 1.1 trillion won, equivalent to 57% of its total sales from 2015 to 2023, according to the Fair Trade Commission. Its construction capability ranking rose from 228th in 2014 to 77th last year. The five subsidiaries of Daebang Industrial Development reportedly achieved sales totaling 511.3 billion won during the same period.