ID :
211523
Thu, 10/06/2011 - 12:01
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Shortlink :
https://oananews.org//node/211523
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Former Lone Star Korea head gets 3-year jail term for stock manipulation
SEOUL, Oct. 6 (Yonhap) -- A Seoul appeals court on Thursday sentenced a former head of U.S.-based Lone Star Funds' local unit to three years behind bars for manipulating the stock prices of a credit card firm when his firm took over the company.
The Seoul High Court handed the jail sentence to Yoo Hoe-won, aka Paul Yoo, Lone Star's former Korea head, alongside a suspended fine of 4.3 billion won (US$3.6 million) for violating the Securities and Exchange Law.
Yoo was indicted in 2007 on charges of releasing a false capital reduction plan for the now-defunct credit card unit of Korea Exchange Bank (KEB) in a bid to drive down stock prices of the company in 2003. Lone Star's local unit took over the credit card firm after the price fell and integrated it into the bank that the fund had previously acquired.
Charges against Yoo included inflicting 24.3 billion won in losses on the company and evading 2.1 billion won of tax.
The ruling came after the Supreme Court dismissed a lower court's not guilty ruling on the stock manipulation charges in March and sent the case to the High Court for retrial.
"Yoo is highly blamable since he exploited the market trust he held as a corporate executive in order to issue a capital reduction rumor, incurring damage to minor shareholders," Judge Cho Kyung-ran of the Seoul High Court said. "But he did not personally benefit (from the scheme) and suffered much pain during the long period of court trials, and his sentence reflects these facts."
Prosecutors had sought a 10-year prison term for Yoo.
In the same ruling, the court also fined LSF-KEB Holdings SCA, a shell company the fund set up to own Korea Exchange Bank, 25 billion won.
The court, however, found KEB not guilty of market manipulation, saying the corporate entity was not responsible because those involved in the scheme were not bank' executives and thus not representing it.
The Seoul High Court handed the jail sentence to Yoo Hoe-won, aka Paul Yoo, Lone Star's former Korea head, alongside a suspended fine of 4.3 billion won (US$3.6 million) for violating the Securities and Exchange Law.
Yoo was indicted in 2007 on charges of releasing a false capital reduction plan for the now-defunct credit card unit of Korea Exchange Bank (KEB) in a bid to drive down stock prices of the company in 2003. Lone Star's local unit took over the credit card firm after the price fell and integrated it into the bank that the fund had previously acquired.
Charges against Yoo included inflicting 24.3 billion won in losses on the company and evading 2.1 billion won of tax.
The ruling came after the Supreme Court dismissed a lower court's not guilty ruling on the stock manipulation charges in March and sent the case to the High Court for retrial.
"Yoo is highly blamable since he exploited the market trust he held as a corporate executive in order to issue a capital reduction rumor, incurring damage to minor shareholders," Judge Cho Kyung-ran of the Seoul High Court said. "But he did not personally benefit (from the scheme) and suffered much pain during the long period of court trials, and his sentence reflects these facts."
Prosecutors had sought a 10-year prison term for Yoo.
In the same ruling, the court also fined LSF-KEB Holdings SCA, a shell company the fund set up to own Korea Exchange Bank, 25 billion won.
The court, however, found KEB not guilty of market manipulation, saying the corporate entity was not responsible because those involved in the scheme were not bank' executives and thus not representing it.
