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Hyosung chief summoned again over alleged tax evasion

Hyosung chief summoned again over alleged tax evasion

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Published : 2013-12-11 14:09
Updated : 2013-12-11 14:09

The head of major family-run conglomerate Hyosung Group was called in Wednesday by prosecutors for a second day of questioning over suspicions of the group's tax evasion and slush funds.

Cho Suck-rai appeared at the Seoul Central District Prosecutors' Office in southern Seoul around 10:50 a.m. to undergo questioning.

The 78-year-old chairman, who was grilled until late last night, was admitted last week at Seoul National University Hospital for cardiac arrhythmia. He was previously hospitalized for high blood pressure and the heart rhythm problems on Oct. 30 and discharged on Nov. 14.

The country's 26th-largest business group is suspected of forging its account books for the past decade to cover up losses incurred during the 1997-98 financial crisis, prosecutors said. It has allegedly evaded several hundred billion won in corporate taxes through the accounting fraud.

Prosecutors alleged that the conglomerate has kept shares under borrowed names since the 1990s with the aim to evade transfer and income taxes worth more than 100 billion won ($94 million), authorities said.

Prosecutors also suspect that Hyosung established shell companies in tax havens in the 1990s with money borrowed from local banks and is under suspicion of having made illegal profits by trading shares on the local stock market with secret funds from the offshore paper firms.

The probe began in late September when the country's tax agency filed a charge against Cho and several other executives with the Seoul prosecution for allegedly leading the tax evasion scheme.

Prosecutors have so far raided the homes and offices of Cho and other executives and grilled two of Cho's three sons -- Cho Hyun-joon, the oldest son and president of Hyosung Group, and Cho Hyun-moon, the second son -- for the investigation.

The group, with more than 11 trillion won in assets, has businesses mainly in the fields of energy and heavy industry. (Yonhap News)

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