S. Korea top court upholds prison term for SK Group head

SK Group's CEO Chey Tae-Won (C) arrives at Central District Court in Seoul on January 31, 2013

South Korea's Supreme Court on Thursday upheld a four-year jail sentence for the head of the country's third largest conglomerate, the SK Group, for embezzlement. Chey Tae-Won, 54, was convicted of diverting 46.5 billion won (43.5 million) from two affiliates in 2008 and funnelling the money into a firm for investments in stock futures and options. The custodial sentence was seen as sending a message in a country where convicted business tycoons have often been given suspended prison terms in recognition of their contribution to the national economy. Chey has been in prison since January last year when a lower court handed down the four-year jail term. The sentence had already been upheld once on appeal prior to the Supreme Court confirmation. There was no immediate comment from the energy-to-telecom conglomerate, which includes top mobile carrier SK Telecom. It was not Chey's first conviction. In 2003 he was sentenced to three years in prison for his role in a $1.3 billion accounting fraud. He was released after just seven months and, in 2008, was granted a full presidential pardon, wiping his record clean. It is not unusual for senior executives with criminal convictions to remain in charge of South Korea's family-dominated conglomerates. The Supreme Court also upheld a 40-month jail sentence for Chey's younger brother and group vice chairman Chey Jae-Won. South Korea has a long history of pardoning powerful tycoons. Hyundai Motor head Chung Mong-Koo, who had been convicted of embezzlement and other charges, was pardoned in 2008, and Samsung Electronics chairman Lee Kun-Hee -- convicted of tax evasion -- was pardoned in 2009.