Former KT CEO questioned on suspected unfair business practices

Prosecutors have questioned a former chief of KT Corp., a major telecom operator in South Korea, as part of an investigation into suspicions that the firm's executives formed a slush fund through unfair subcontract deals, sources said Friday. The Seoul Central District Prosecutors Office grilled former KT CEO Ku Hyeon-mo on Wednesday as a main suspect behind the suspicions, the legal sources said. Prosecutors have been looking into allegations that Ku and other high-ranking officials at KT formed a "cartel" to illegally funnel the company's subcontract deals to select contractors and established a slush fund with the generated proceeds worth millions of dollars. After Ku took office in 2020, KT replaced KT estate with KT telecop as the subsidiary responsible for facility maintenance, and KT telecop subsequently conferred subcontract deals to two contractors, KDFS and KSmate, reportedly resulting in the doubling of their revenues over two years. Previously, such subcontract deals had been distributed to f our contractors. Prosecutors suspect that Ku, another former KT CEO Nam Joong-soo and other high-ranking officials may have been behind the process. Last year, prosecutors indicted KDFS' chief on charges of pocketing 4.8 billion won (US$3.5 million) of corporate funds, and searched the KT's headquarters in central Seoul as part of the investigation. Source: Yonhap News Agency