A South Korean court Friday upheld fraud and embezzlement convictions against Daewoo Group founder Kim Woo-Choong, whose empire collapsed in 1999 in one of the world's largest corporate failures.
But it also cut more than a year off the prison sentence for the ailing 69-year-old, who epitomised South Korea's rags-to-riches transformation into one of the world's major industrial economies.
The self-made tycoon, who appeared in court in a wheelchair wearing a blue prison uniform, bowed his head slightly as High Court Judge Suk Ho-Chul read a lengthy verdict that chronicled Daewoo's rise and fall.
"He deserves heavy punishment as the collapse of Daewoo Group caused enormous damage to our economy but we should consider his age, ailments, repentance and contribution to our economy," the judge said.
"A reduced jail term is given in consideration of his pain in watching Daewoo Group's collapse and (his) great contribution to our economy." Kim's prison time was cut from 10 years to eight years and six months. The judge also reprimanded Kim for "mismanagement and poor judgement" that prompted a chain of bankruptcies.
Daewoo had debts of 82 billion dollars when it went under in the wake of the Asian financial crisis. The government was forced to spend some 30 trillion won (now 31.7 billion dollars) to rescue it.
Kim fled the country. As the corporate meltdown unfolded he was accused of ordering his executives to inflate the group's assets between 1997 and 1998 to obtain bank loans, and of smuggling 3.2 billion dollars overseas.
He was indicted in June last year after returning from a six-year overseas exile. The appeal court upheld Kim's conviction for masterminding accounting fraud involving 20 trillion won and borrowing 9.8 trillion won from banks through illegal means, as well as the conviction for smuggling funds overseas.
It reduced the amount of restitution he must pay from 21.4 trillion won ordered in May to 17.9 trillion won. This is still the highest financial penalty in South Korea's judicial history.
Prosecutors had called for a longer jail term, insisting Kim had bribed government officials and politicians to expand his business empire and acquire bank loans illegally. But the court refused to accept the demand, citing lack of evidence.
Kim had been receiving hospital treatment following heart bypass surgery and other ailments. He was returned to prison on Monday after a court rejected his request for a longer stay in hospital.
About 80 friends and former Daewoo officials observed a hushed silence as Kim entered the courtroom, aided by two security guards. "I cannot accept the verdict. The court should have considered his poor health," Kim Sung-Ho, a former Daewoo official, told AFP.
Kim emerged from childhood hardship to launch his own textile trading firm with a 5,000-dollar bank loan in 1967 and turned it into a top conglomerate in the 1970s and 1980s.
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