The first preparatory hearing for the appeal case involving Cho Hyun-bum, chairman of Hankook & Company, on charges of embezzlement and breach of trust ended after about 20 minutes on the 11th. Hankook & Company is the holding company of Hankook Tire & Technology, a tire manufacturer. The formal first trial date is set for September 8.
The Seoul High Court's Criminal Division 13 (presiding judge Director General Baek Kang-jin) held the first preparatory hearing for the case against Chairman Cho, which involves violations of the Act on the Aggravated Punishment of Specific Economic Crimes (embezzlement and breach of trust), embezzlement and breach of trust in the course of duty, violations of the Fair Trade Act, and bribery.
The preparatory hearing is a process to organize the issues, evidence, and future schedules regarding the case prior to the formal trial. Although the defendant is not obligated to attend, Chairman Cho appeared in court that day wearing a brown prison uniform. He was incarcerated and is currently in custody following the first trial.
Chairman Cho's lawyer explained the reasons for the appeal, stating, "There are parts where the first trial court misinterpreted the evidence and areas where the ruling involved judgments or assumptions that were inadequate." The prosecution appealed on the grounds of factual misapprehension, legal misinterpretation, and unfair sentencing.
On that day, the court decided on the method of presenting arguments using PowerPoint regarding each issue. Chairman Cho's side decided to argue using PowerPoint on the charges of breach of trust under the Act on the Aggravated Punishment of Specific Economic Crimes and some embezzlement and breach of trust issues for which he was convicted in the first trial. The prosecution stated it would present arguments using PowerPoint regarding the violation of the Fair Trade Act, which was ruled not guilty in the first trial.
The court will hold the first trial date for this case on September 8 and proceed with arguments using PowerPoint concerning the breach of trust charges under the Act on the Aggravated Punishment of Specific Economic Crimes.
This case began when the Fair Trade Commission filed a complaint against Hankook Tire in November 2022 for violations of the Fair Trade Act. At that time, the Fair Trade Investigation Division of the Seoul Central District Prosecutor's Office (Director General Lee Jeong-seob) confirmed signs of Chairman Cho's involvement through additional investigations. The prosecution arrested and indicted Chairman Cho in March 2023 on charges of embezzlement and breach of trust under the Act on the Aggravated Punishment of Specific Economic Crimes, embezzlement and breach of trust in the course of duty, and violations of the Fair Trade Act. In July of the same year, Chairman Cho was additionally indicted for bribery. However, he was released on bail in November 2023 and has been undergoing the first trial.
Chairman Cho's charges can be broadly divided into three categories. There are allegations of breach of trust under the Act on the Aggravated Punishment of Specific Economic Crimes and violations of the Fair Trade Act for improperly supporting affiliates where he is the majority shareholder. Additionally, there are charges of embezzlement and breach of trust for using the company's foreign vehicles and corporate credit cards for personal purposes. Furthermore, there are allegations of breach of trust and bribery for lending affiliate funds to a friend's company in poor financial condition or assigning the task of issuing travel tickets to a travel agency.
In the first trial, Chairman Cho was sentenced to three years in prison and was taken into custody. The first trial court found him guilty of breach of trust under the Act on the Aggravated Punishment of Specific Economic Crimes for lending affiliate funds to a friend's company without reasonable debt recovery measures.
Furthermore, the court acknowledged that Chairman Cho engaged in embezzlement and breach of trust by misusing about 580 million won for personal purposes using the company's corporate credit card, allowing his spouse to be exclusively assisted by the company driver, purchasing or renting five foreign vehicles in the company's name for personal use, and making expenses for personal director fees and furniture purchases with company funds. It also recognized the bribery charge for complying with a request from a friend to centralize the task of issuing airline tickets for Hankook & Company's affiliates to RedcapTour.
However, the court ruled that Chairman Cho was not guilty of the breach of trust and Fair Trade Act violations for improperly supporting affiliates where he is the majority shareholder.