The prosecution has sought an arrest warrant for Kim Hyun-seung, CEO of Mongo Foods, on charges of embezzling billions of won by setting up an overseas corporation.
The Busan District Prosecutors' Office said on Jan. 25 that it requested an arrest warrant for Kim for his alleged violations of the Foreign Trade Act, the Special Business Act, the Tax Crimes Act, and the Special Criminal Law (issuance of the false tax bill).
The questioning of Kim's arrest will take place on Jan. 28 at the earliest. Kim is suspected of taking over billions of won in commissions over the years by setting up a corporation that manages the supply and demand of defatted soybeans, a raw ingredient of soy sauce, in the U.S.
The corporation is said to have received commissions equivalent to 10 to 15 percent of the import price of soybeans from Mongo Foods.
Prosecutors believe that Kim made profits by inflating the price of soybeans through the US-based corporation, instead of directly importing them. In the process, Kim is also suspected of issuing fake tax bills worth billions of won.
The prosecution has summoned Kim twice as a suspect to investigate the reason for the establishment of the corporation and the cause for buying soybeans higher than the market price, and confirmed the flow of funds in the accounting books of Mongo Foods and the corporation.
Meanwhile, CEO Kim reportedly denied the charge, saying, "We just gave the commissions to the corporation according to the normal contract we had signed."
