The end of the road for Daewoo founder
By Our Corporate Bureau | 21 Nov 2006
Mumbai: Kim Woo-choong, 69, the man who founded the Daewoo group and turned it into what was once the country's second largest chaebol (Korean for conglomerate) said that he would not appeal his eight-and-a-half-year jail sentence for fraud.
The Daewoo founder who was at the centre of one of the biggest corporate failures in history was sentenced earlier this year to 10 years in jail for embezzlement and fraud for covering up billions of dollars in debt, court officials said.
An appeals court had, earlier this month, reduced the 10-year sentence by 18 months to eight and a half years, saying Kim had done the country a service by forming the ships to thread-spools group that once employed some 360,000 people.
Kim is charged with illegally procuring loans of about 10 trillion won ($10.7 billion), taking about $20 billion in Daewoo funds through overseas accounts and helping doctor Daewoo's books to falsify assets of about 41 trillion won.
Kim fled South Korea in 1999 when Daewoo collapsed under the weight of debts that rose to more than $75 billion. Kim returned in 2005 and was arrested soon after.
Court procedures were delayed as Kim underwent two heart surgeries at a South Korean hospital. He was released in August last year after the court accepted his request that his detention be suspended for health reasons, but was jailed again on October 31 before the sentencing.
He is currently under treatment because of heart problems and pneumonia.
Daewoo was one among a few chaebols that helped rebuild the South Korean economy in the years after the 1950-53 war, but their obscure business practices and unrestrained borrowing led to a financial crisis in the late 1990s.