ID :
211559
Thu, 10/06/2011 - 13:29
Auther :
Shortlink :
https://oananews.org//node/211559
The shortlink copeid
(LEAD) Lone Star and its former Korea head found guilty of stock manipulation
(ATTN: RECASTS lead, TRIMS throughout)
SEOUL, Oct. 6 (Yonhap) -- A Seoul appeals court on Thursday ordered a heavy fine for U.S.-based Lone Star Funds' local unit and sentenced a former local head to three years behind bars for manipulating the stock prices of a credit card firm before the fund took over the company.
The Seoul High Court ordered a fine of 25 billion won (US$21.1 million) for LSF-KEB Holdings SCA, a shell company the fund set up to own Korea Exchange Bank (KEB) after buying the lender in 2003, for violating the Securities and Exchange Law.
The court also handed down a three-year prison term to Yoo Hoe-won, aka Paul Yoo, Lone Star's former Korea head, alongside a suspended fine of 4.3 billion won for masterminding the manipulation scheme.
Yoo was indicted in 2007 on charges of releasing a false capital reduction plan for the now-defunct credit card unit of 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.
LSF-KEB Holdings was found guilty of participating in the manipulation scheme as its head Michael Thompson colluded with other Lone Star executives in the false plan, the court said.
"The fraudulent transaction was carried out for the eventual benefit of LSF-KEB Holdings and the profit reached about 10 billion won," Judge Cho Kyung-ran of the Seoul High Court said.
Charges against Yoo also included inflicting 24.3 billion won in losses on the company and evading 2.1 billion won in taxes.
The ruling came after the Supreme Court dismissed a lower court's not guilty ruling on Yoo's 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," the judge 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.
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 the bank's executives and thus not representing it.
SEOUL, Oct. 6 (Yonhap) -- A Seoul appeals court on Thursday ordered a heavy fine for U.S.-based Lone Star Funds' local unit and sentenced a former local head to three years behind bars for manipulating the stock prices of a credit card firm before the fund took over the company.
The Seoul High Court ordered a fine of 25 billion won (US$21.1 million) for LSF-KEB Holdings SCA, a shell company the fund set up to own Korea Exchange Bank (KEB) after buying the lender in 2003, for violating the Securities and Exchange Law.
The court also handed down a three-year prison term to Yoo Hoe-won, aka Paul Yoo, Lone Star's former Korea head, alongside a suspended fine of 4.3 billion won for masterminding the manipulation scheme.
Yoo was indicted in 2007 on charges of releasing a false capital reduction plan for the now-defunct credit card unit of 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.
LSF-KEB Holdings was found guilty of participating in the manipulation scheme as its head Michael Thompson colluded with other Lone Star executives in the false plan, the court said.
"The fraudulent transaction was carried out for the eventual benefit of LSF-KEB Holdings and the profit reached about 10 billion won," Judge Cho Kyung-ran of the Seoul High Court said.
Charges against Yoo also included inflicting 24.3 billion won in losses on the company and evading 2.1 billion won in taxes.
The ruling came after the Supreme Court dismissed a lower court's not guilty ruling on Yoo's 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," the judge 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.
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 the bank's executives and thus not representing it.
