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Celebrating New Year's Eve, South Korea granted amnesty to 75 politicians and businessmen, including the former chairman of Daewoo Group, Kim Woo-choong.Kim Woo-choong was sentenced by a Seoul appeals court on Friday November 3, 2006 to eight and a half years in prison. The founder and former chairman of collapsed conglomerate Daewoo, who was sentenced for embezzlement, accounting fraud, illegal financing and diverting funds out of the country, was pardoned under the presidential amnesty. For the others, South Korea reduced sentences or had suspended rights restored.
The end of Daewoo Group was the 1997-98 Asian financial crisis which came with massive debt for the company. During that crisis, South Korea's government was forced to accept a $58 billion International Monetary Fund bailout.
Back during that period, Detroit-based General Motors Corp. (NYSE: GM) didn't miss the opportunity to buy a major stake in Daewoo Motor to create GM Daewoo in 2002.
Among other convicts who also enjoyed South Korea's special presidential amnesties were the two former chiefs of the country's spy agency, Lim Dong-won and Shin Gunn. The two were sentenced last year when a court's ruling found them guilty of involvement in the agency's illegal wiretapping of phone conversations of high-profile figures.
The huge scandal that has shaken South Korea violently in 2005 was caused by a tapped phone conversation between the head of a leading newspaper and a top Samsung Group executive. The conversation was related to illicit campaign funds that should have been provided to candidates in the 1997 presidential race. Following the massive scandal, South Korea's ambassador to the U.S., the publisher of the newspaper involved, had to resign.
Eliza Popescu is a financial writer for the online investment advisory service Investor's Observer.
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