Former Keangnam Chairman commits suicide amid suspicion of setting up a black fund

While investigators plan to arrest the former Keangnam Chairman, he insists he did nothing wrong and seeks death.

South Korean police have just found the body of Mr. Sung Woan-jong, former Chairman of Keangnam Enterprises on Bukhan Mountain, south of Seoul, South Korea. According to the initial conclusions of the police, this is a suicide.

Police carried the body of former Keangnam Enterprise Chairman Sung Woan-jong down the mountain yesterday. Photo: Korean Times

The incident occurred in the context of the former Chairman of Keangnam being at the center of a recent widespread anti-corruption investigation in Korea. Prosecutors accused Keangnam Enterprises, along with several other companies, of financial irregularities such as setting up a slush fund under President Lee Myung Bak.

At Mr. Sung's home, police found a suicide note, explaining that the reason for his suicide was to prove his innocence. "I did not do what people accused me of doing. Please bury me next to my mother's grave," he wrote in the note.

According to the police plan, Mr. Sung will be summoned to court to decide whether or not to issue an arrest warrant as requested by prosecutors. Mr. Sung's death is assessed to affect the investigation process.

In his suicide note, Mr. Sung Woan-jong, former Chairman of Keangnam Enterprises, explained the reason for his suicide to prove his innocence.

Prosecutors previously charged Sung and Keangnam Enterprises with taking 80 billion won ($74 million) in loans from the government and private organizations by falsifying financial data from 2006 to 2013. He is also suspected of creating a 25 billion won slush fund and committing accounting fraud of 950 billion won.

On Wednesday, Mr. Sung held a press conference and denied all allegations. "There were 86 companies involved in those projects. I don't understand why only Keangnam was named," he said. "It is impossible to embezzle money because we have to use the company's funds first and then receive payment from the government. Allegations that money was spent elsewhere before receiving payment are meaningless," he continued.

The allegations against Keangnam are part of a recent wide-ranging anti-corruption investigation in South Korea. The list of companies being targeted by investigators includes POSCO and its subsidiary POSCO E&C, Korea National Oil Company and Lotte Group and its subsidiary Lotte Shopping. POSCO E&C is suspected of inflating the cost of building a highway in Vietnam to create a slush fund of nearly $10 million.

According to VnExpress