A South Korean court yesterday 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 epitomized 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," he said.
Kim's jail time was cut from 10 years to eight years and six months.
The judge also reprimanded Kim for "mismanagement and poor judgment" that prompted a chain of bankruptcies.
Daewoo had debts of US$82 billion when it went under in the wake of the Asian financial crisis. The government was forced to spend some 30 trillion won (now US$31.7 billion) 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 US$3.2 billion 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.