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South Korean conglomerates act as though they are above the law

In one case, a former worker alleges that he was beaten and then paid off, just one example that has the public clamoring for an end to impunity for some family-owned firms, called chaebols.

December 01, 2010|By John M. Glionna and Ethan Kim, Los Angeles Times

Reporting from Seoul — Yoo Hong-joon says he knows the wrath of the rich and powerful in a nation dominated by family-owned firms known as chaebols.

The 52-year-old former driver says that in October, as board members watched, a trucking company owner beat him repeatedly with an aluminum baseball bat in anger over Yoo's former union activities.

Chey Cheol-won reportedly told Yoo, who had been laid off a year earlier, that he would pay the ex-driver $1,000 a blow, and then later increased the payoff to $3,000. Each time Chey swung the bat, Yoo alleges, the businessman ordered him to call out the number of strikes to his legs and buttocks. After punching him in the head and face, Yoo says, the owner threw money at him and then had his men dump him into a taxi.

"I felt powerless," Yoo said. "Big companies here have the attitude that they can do anything they want."

Yoo filed documents Tuesday with Seoul police seeking criminal prosecution.

Chey, who has not yet been charged with a crime, could not be reached for comment. But one company executive told Seoul TV of Yoo, "I'm not saying he wasn't beat. He was clearly beat up. But he imposed it on himself to get more money."

Legal experts say Yoo's accusations underscore the power wielded in South Korean society by top executives in the chaebols, huge conglomerates, who at times act as though they are above the law.

In recent years, chaebol executives have been convicted of accounting fraud, embezzlement and breach of duty. Many of those sentences were soon commuted or reduced. In 2009, convicted tax evader Lee Kun-hee, chairman of Samsung Electronics, was pardoned by President Lee Myung-bak, who wanted his help with South Korea's bid to host the 2018 Winter Olympics. The president is also a former corporate big shot, the onetime chief executive of Hyundai Construction.

The alleged attack by Chey, a cousin of one of the wealthiest businessmen in South Korea, would be the second assault in three years involving the nation's rich and powerful.

In 2007, the chairman of chemical and insurance giant Hanwha Group was convicted of orchestrating the kidnapping and beating of bar employees who had injured his son in a brawl. Kim Seung-youn, convicted of the attack involving his bodyguards and gang members, was later pardoned by the president.

But South Koreans may finally be growing weary of such chaebol misdeeds. Since news of Yoo's allegations surfaced here this week, 30,000 Internet users have called for Chey's arrest.

"Please imprison Chey and show us that there is minimum justice in this society," wrote one. Another wrote, "Enough to corrupt power."

"It appears these tycoons are living their lives with a sense of entitlement, a sense that they are untouchable," said Kim Sang-jo, an economist at Seoul's Hansung University and executive director of a civic group called Solidarity for Economic Reform.

Experts say the lax attitudes toward the chaebols stem from South Korea's obsession with the success that fueled the nation's rise from the economic ruins of the Korean War. The chaebols are seen as too integral to that success to be constrained.

The firms thrived on ties to the corrupt military governments in the 1960s, maintaining their influence even after the nation turned to democracy in 1987. Analysts say they are incapable of policing themselves.

Yoo said his troubles began last year when Chey ordered employees to quit the local union. Yoo was fired from his job of more than 20 years delivering asphalt across South Korea.

For months he sought work as he spent his family savings and ran up credit card debt to pay the bills for his wife and teenage daughter. He decided to sell his big rig to the company and agreed to meet with its officials. "Selling that truck was like selling part of myself," he said.

When he arrived Oct. 18, Yoo said, officials ordered him to get to his knees as Chey entered the room.

Yoo said that as seven company officials looked on, Chey kicked him and then struck him nearly a dozen times with the baseball bat. At one point, he upped the money per hit to $3,000, saying "but now I'm really going to hurt you," Yoo said.

Chey then tossed money at him, Yoo said, demonstrating how the owner threw two checks into his face: one, the equivalent of $45,000, to pay for the truck, and the other, for about $18,000, for the beating. He has not cashed either check, he said.

Yoo hopes the case will bring more scrutiny of the chaebols.

"Common people like me are insignificant in their eyes," he said. "The little guy in South Korea has been kicked around for too long."

john.glionna@latimes.com

Kim works in The Times' Seoul Bureau.

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