Former Samyang Foods Chairman Given Suspended Prison Sentence over KRW 50 Billion False Tax Invoices

A suspended prison sentence has been finalized for former Samyang Foods Chairman Jeon In-jang, who was indicted on charges of creating tens of billions of won in false tax invoices while embezzling company funds through shell companies.

On the 10th, the Supreme Court's Second Division (Presiding Justice Oh Kyung-mi) finalized the lower court ruling sentencing Jeon to three years in prison, suspended for five years, and a fine of KRW 19.1 billion in the re-appeal trial for charges including violations of the Act on the Aggravated Punishment, etc. of Specific Crimes.

Samyang Foods and two of its affiliates, which were indicted alongside Jeon under the Punishment of Tax Evaders Act for their involvement in the crimes, each had their fines of KRW 10 million upheld.

Jeon was indicted in December 2019 on charges of issuing KRW 53.8 billion worth of false invoices and tax invoices between 2010 and 2017 through two shell companies he operated.

The first trial sentenced Jeon to three years in prison, suspended for five years, and a fine of KRW 19.1 billion.

The second trial found the charges under the Punishment of Tax Evaders Act not guilty, reducing his sentence to one year and six months in prison, suspended for three years, and a fine of KRW 650 million.

The appellate court ruled that the portions where the two affiliates engaged in external transactions should be regarded as conducting business with their own assets and responsibilities and paying value-added tax.

However, in February of last year, the Supreme Court overturned the appellate court ruling and sent the case back to the Seoul High Court, stating that the transaction portions previously acquitted by the appellate court also constituted the issuance of false tax invoices.

At the time, the Supreme Court ruled that "the affiliates did not register as businesses simply borrowing the names of the shell companies to conduct actual business, but rather, during the embezzlement process, transferred their sales to the shell companies and used the existing business registrations under the shell companies' names to falsely issue and receive tax invoices."

In November of last year, the remand trial sentenced him to three years in prison, suspended for five years, and a fine of KRW 19.1 billion, identical to the first trial.

Previously, former Chairman Jeon was sentenced to three years in prison, which was finalized by the Supreme Court, for charges including siphoning off approximately KRW 4.9 billion between 2008 and 2017 by faking that packaging boxes and food ingredients supplied to Samyang Foods by affiliates were instead supplied by shell companies.

Tax authorities launched an investigation after catching signs that former Chairman Jeon committed additional crimes, such as issuing false tax invoices through shell companies in the process of embezzling company funds.

(Photo: Yonhap News)
※ Please note: This article was translated by AI and may contain errors.