State prosecutors sought an arrest warrant Tuesday for the head of a local mine developer on charges of reaping massive profits from a stock price manipulation scheme linked to a diamond mining project in Cameroon.
CNK International President Oh Deok-gyun allegedly pocketed about 90 billion won ($83.24 million) by exaggerating the volume of diamond reserves in a Cameroon mine through a press release that inflated the KOSDAQ-listed company's stock prices.
Oh was apprehended at Incheon International Airport, South Korea's main gateway, on Sunday after two years of hiding in Cameroon amid the investigation.
A Seoul court is scheduled to hold a hearing later in the day to review the prosecution's request and determine whether to issue an arrest warrant for the disgraced businessman.
The press release, issued by Seoul's foreign ministry in December 2010, claimed the company won a project near the southeastern town of Yokadouma, Cameroon, to mine about 420 million carats of diamonds, 2.5 times the annual global diamond production
at that time, prosecutors said. The mine was later found to hold only 6 percent of the exaggerated amount of diamonds.
Following the announcement, shares of CNK jumped from about 3,000 won to 16,100 won per share, more than fivefold, in about three weeks, prosecutors said.
The prosecution office already charged other suspects in the alleged scheme, including Kim Eun-seok, the former Energy and Resources ambassador, and former vice-chairman of the CNK surnamed Yim, who committed suicide amid court trials. (Yonhap)