Prosecutors on Thursday sought a 15-year prison term for the head of financially troubled Tong Yang Group charged with fraudulently issuing and selling financial products, inflicting losses on nearly 40,000 individual investors.
Chairman Hyun Jae-hyun is standing trial on charges of orchestrating the issuance of fraudulent corporate bonds and commercial paper (CP) worth some 1.33 trillion won (US$1.22 billion) under the names of the group's affiliates between February and September of last year, even though he knew it was likely the affiliates would be unable to repay maturing debts, prosecutors said.
"Hyu, as the group's final decision maker, did not make a choice to avoid inflicting losses to investors," said a prosecutor during Hyun's trial.
Prosecutors further allege that Hyun ordered the family-owned conglomerate's money lending unit to illegally extend loans worth 623.1 billion won to the group's other key units suffering from cash shortages.
The 65-year-old chairman is facing multiple charges of fraud, breach of duty and embezzlement, prosecutors said. (Yonhap)