Former Namyang Dairy Products Chairman Hong Won-sik, who was brought to trial on charges of embezzlement and breach of trust totaling about 20 billion won, was sentenced to three years in prison in the first trial. However, the court found him guilty on only two of the eight charges applied to him, including receiving bribes in breach of trust (worth about 7.3 billion won), and found him not guilty or dismissed the remaining six charges.
The Criminal Agreement Division 21 of the Seoul Central District Court (Presiding Judge Lee Hyun-bok) on the 29th sentenced the former chairman to three years in prison and ordered the forfeiture of 4.376 billion won on charges including violating the Act on the Aggravated Punishment of Specific Economic Crimes (breach of trust). The court did not remand him to custody in court, considering his age and health, and the preparation of plans to remedy harm to Namyang Dairy Products and its shareholders.
The court found him guilty of receiving bribes in breach of trust by taking 4.3 billion won in rebates from four suppliers. It also found him guilty of privately using corporate property such as company-owned vehicles and a villa.
On the other hand, regarding the breach of trust charge alleged by prosecutors that "during the transaction process, a company run by relatives was inserted, causing damage to the company," the court acquitted him, saying it is difficult to conclude based on the submitted evidence alone that Namyang Dairy Products unfairly involved the company and caused damage to the company at the time.
The court also ruled not guilty on the allegation that he was involved in advertising during the COVID-19 outbreak that the "Bulgaris" product had an effect in suppressing COVID-19, saying there was no proof of collusion. The charge that he instigated the destruction of evidence after the investigation began was also deemed lacking in proof of a crime.
As for arranging for a cousin to be employed at a supplier and receive a salary, the court did not recognize third-party bribery in breach of trust, saying it is difficult to view it as a separate benefit from an improper solicitation. Among the charges that he embezzled money received from suppliers as advertising fees and audit salaries, some were dismissed due to the statute of limitations, and some were found not guilty.
Of the five defendants indicted together, including a former research institute head identified as a person surnamed Park, four were sentenced to terms ranging from one year in prison suspended for two years to three years in prison, and one was acquitted.
In the closing arguments in Dec. last year, prosecutors sought 10 years in prison and about 4.3 billion won in forfeiture for the former chairman. They also asked the court to sentence the co-defendants to two to five years in prison and order forfeitures in the 100 million won range.
Meanwhile, the former chairman's wife, Lee Un-kyung, a former adviser, former Executive Director Hong Jin-seok, head of management innovation promotion, and former Associate Executive Director Hong Beom-seok, head of the food service division, who were indicted on charges of privately using about 3.7 billion won in company funds, were also convicted in the first trial the same day.
Lee, the former adviser, was sentenced to two years and six months in prison, suspended for four years; the former executive director Hong was sentenced to three years in prison, suspended for five years; and the former associate executive director Hong was sentenced to two years in prison, suspended for four years.