Prosecutors Raid KT&G Partners For Corruption
D-Bo , Aug. 13, 2015, 9:40 a.m.
Prosecutors said Thursday they have raided the offices of several business partners of the nation's leading tobacco maker over allegations that they created a slush fund by exaggerating the unit prices of components used to make tobacco. The Seoul Central District Prosecutor's Office said it has raided seven companies, including three that are contracted with KT&G Corp., the state-run tobacco firm, on charges of fraud and malpractice.
Accounting books and internal documents were confiscated from a cigarette pack maker's headquarters and factory located in Anseong, Gyeonggi Province, 77 kilometers south of Seoul. In addition to the cigarette pack maker, only identified by its initial S, the offices of other business partners that make components of tobacco were searched.
Prosecutors are investigating whether KT&G created slush funds by exaggerating the unit price of the components. Min Young-jin, the former head of KT&G, is suspected of raising secret funds while in office. Prosecutors have been examining the company's financial situation and transaction structure to determine whether the firm's executives received illegal funds. Min resigned last month as prosecutors launched the investigation.