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Lotte founder's daughter arrested for bribery, embezzlement


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Lotte Foundation Chairwoman Shin Young-ja, 73, was placed in detention Thursday on charges of embezzlement and bribery, after the Seoul Central District Court issued a warrant for the eldest daughter of Lotte Group founder Shin Kyuk-ho.

She is the first Lotte owner family member to face arrest since the prosecution began investigating the nation’s fifth-largest conglomerate early last month.

She is suspected of receiving some 3 billion won from companies in return for placing their counters in favorable locations at Lotte’s duty free shops, including 1.5 billion won from disgraced former Nature Republic CEO Jung Woon-ho. 

Although the companies paid in the form of “consultation fees†to a luxury goods logistics company owned by her son, surnamed Jang, prosecutors believe that the money was ultimately delivered to Shin, the de facto owner of the son’s firm.

She is also suspected of embezzling some 4 billion won in company funds by registering her three daughters as company board members so they could receive salaries, until 2013.

Shin herself is believed to have fraudulently received the salary as well after opening a bank account with a name borrowed from a senior company official.

Prosecutors are looking into Lotte’s affiliates in which Shin is registered as a board member or stakeholder, following allegations that she used the affiliates to created a slush fund by fraudulent accounting and conducting illicit intra-group financial transactions.

Prosecutors said that Shin was questioned not only for her personal corruption but also over group-wide irregularities.

In response, while Lotte Group tries to distance itself from her by claiming that the investigation is focused on her, it is also showing concerns because she might offer the prosecution testimony unfavorable to her half-brother, group Chairman Shin Dong-bin, in return for leniency.

The chairwoman, who served as the CEO of Lotte Shopping between 2008 and 2012, has been deeply involved in the group’s logistics business since 1983 when she began participating in group management as an executive. 

She stood at odds with her younger half-brother Dong-bin after he took the reins of power from their father and withdrew her food companies from the snack business at Lotte Cinema chains in 2013.

Last year, she went to Japan to attend a shareholders’ meeting alongside her father and eldest half-brother Dong-ju to vote in favor of dismissing Dong-bin from the group chairmanship. 
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Source: http://m.koreatimes.co.kr/phone/news/view.jsp?req_newsidx=208873

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