Defendant

Kim Jin-Jin (Lawsuits) and Cho Man-Man (Trial)

Attorney Kim Tae-il

A defendant shall be punished by imprisonment for three years.

On November 21, 2008, the Defendant was sentenced to one year and six months of imprisonment by the Seoul High Court for a violation of the Punishment of Violences, etc. Act (joint conflict), and on June 12, 2009, the execution of the sentence was terminated at the Tong Detention House on June 12, 2009. On March 28, 2011, the Defendant acquired shares of Nonindicted Co. 3, subject to the payment of KRW 14.5 billion from Nonindicted Co. 2 of the former representative director of Nonindicted Co. 3 (hereinafter referred to as “Nonindicted Co. 3”), subject to the payment of KRW 14.5 billion from Nonindicted Co. 2, 201, the Defendant acquired shares of Nonindicted Co. 3, 151, 191, and the management right equivalent to 17.97% of the equity ratio, while serving as the representative director of Nonindicted Co. 3’s company from April 7

1. Violation of the Act on the Aggravated Punishment of Specific Economic Crimes;

As the representative director of the victim Nonindicted Co. 3, the Defendant had a duty to use the funds owned by Nonindicted Co. 3 for the benefit of the company.

On April 7, 2011, the Defendant borrowed 6 billion won on the condition that the bonds company Nonindicted 1 pay for 6 billion won after 3 months from Nonindicted 1 in order to pay 14.5 billion won of the acquisition price of stocks and management rights to Nonindicted 3’s former representative director at ○○○○○○○○ branch of the Seoul Jung-gu (hereinafter omitted). The Defendant personally borrowed 6.0 billion won on the condition that the bonds company would pay for 6.0 billion won of time deposit deposited in the SC Bank in the name of Nonindicted 3, at the same time and at the same place as the above Nonindicted 1 demanded cash security.

Accordingly, the Defendant obtained pecuniary benefits equivalent to KRW 6 billion from the amount of pledge to Nonindicted Co. 1, thereby causing damage equivalent to the same amount to said Nonindicted Co. 3.

2. Violation of the Financial Investment Services and Capital Markets Act;

No one shall make a false statement or representation in the report on the status of stocks, etc. held in bulk with respect to important matters prescribed by Presidential Decree, such as the date of acquisition or disposal of stocks, the terms of trust or security contract,

On May 3, 2011, the Defendant submitted to the Korea Exchange a report on the status of possession of stocks, etc. to the effect that “Non-Indicted 3 acquired shares of Non-Indicted 3 with its own funds, etc. and concluded a security contract, etc. for stocks.”

However, on March 31, 201, the Defendant borrowed KRW 1.8 billion from Nonindicted 6 to Nonindicted 6 at a corporate bank △△△△△△△ branch located in Yongsan-gu Seoul (hereinafter omitted), and offered the above Nonindicted 6 as security.

As a result, the Defendant made a false statement on the contents of a security contract on the report on the status of stocks held.

3. Violation of the Act on the Aggravated Punishment, etc. of Specific Economic Crimes;

On April 7, 2011, the Defendant personally borrowed 6 billion won from Nonindicted Co. 1 to Nonindicted Co. 2, the former representative director of Nonindicted Co. 3, in order to pay an intermediate payment of KRW 6 billion out of KRW 14.5 billion to Nonindicted Co. 3’s acquisition of shares and management rights.

On July 11, 2011, the Defendant kept 6 billion won in cash owned by Nonindicted Co. 3 in the SC Japan bank account in the name of Nonindicted Co. 3 in the name of Nonindicted Co. 3 at ○○○○○○○ branch of the Seoul Jung-gu (hereinafter omitted) on business, and paid to the said Nonindicted Co. 1 after withdrawing the full amount of the cash owned by Nonindicted Co. 3, which was deposited in the said SC Japan bank account in order to repay the borrowed amount, even if the maturity of the borrowed amount with respect to Nonindicted Co. 1 arrives.

Accordingly, the Defendant embezzled 6 billion won in cash owned by Nonindicted Co. 3.

1. Each legal statement of the witness Nonindicted 2, 1, 7, 8, and 9

1. Each of the witness Nonindicted 4, 10, and 11’s legal statements

1. Each prosecutorial suspect interrogation protocol against Nonindicted 10 and 9

1. The prosecutor’s statement concerning Nonindicted 2

1. Investigation report (related published data), investigation report (informating a contract for acquisition of management rights), investigation report (in case of Non-Indicted 1 data), investigation report (in case of holding stocks in bulk), investigation report (in case of Non-Indicted 1 data), investigation report (in case of Non-Indicted 1 data),

1. Previous convictions in judgment: Investigation report (the criminal records of the accused);

1. Article applicable to criminal facts;

Article 3 (1) 1 of the Act on the Aggravated Punishment, etc. of Specific Economic Crimes, Articles 356, 355 (2) of the Criminal Act (the point of breach of trust, the choice of limited imprisonment), Article 444 subparagraph 18, Article 147 of the Financial Investment Services and Capital Markets Act (the point of false public disclosure, the choice of imprisonment), Article 3 (1) 1 of the Act on the Aggravated Punishment, etc. of Specific Economic Crimes, Articles 356 and 355 (1) of the Criminal Act (the point of embezzlement, the choice of limited imprisonment)

1. Aggravation for repeated crimes;

Articles 35 and proviso of Article 42 of the Criminal Act

1. Aggravation for concurrent crimes;

The former part of Article 37, Article 38(1)2, Article 50, and the proviso of Article 42 of the Criminal Act

1. Discretionary mitigation;

Articles 53 and 55 (1) 3 of the Criminal Act (see, e.g., Supreme Court Decisions 201Do1148, Apr. 2, 2011>

1. The Defendant asserts that the actual transferee of Nonindicted Co. 3 is Nonindicted Co. 10 and Nonindicted 4, and that himself cannot be the subject of the crime of breach of trust and the crime of embezzlement.

Many circumstances are found to deem that the persons who actually attempted to acquire Nonindicted Co. 3 was Nonindicted Co. 10 or Nonindicted Co. 4. However, the Defendant concluded a contract for acquisition of the shares and the right of management of Nonindicted Co. 3 in their own name, acquired the shares of the company in its own name, and was appointed as the representative director. Furthermore, KRW 6 billion, which Nonindicted Co. 1 lent on April 7, 201, was first paid to Nonindicted Co. 2 as the acquisition price of Nonindicted Co. 3’s company, and on the same day, Nonindicted Co. 2 deposited the said KRW 6 billion into Nonindicted Co. 3’s account in the name of repayment of the existing obligations to Nonindicted Co. 3, thereby becoming the company’s property. Subsequent, Nonindicted Co. 1 withdrawn KRW 6 billion in the account of Nonindicted Co. 3 under the name of debt repayment with the consent of the Defendant.

For this reason, the crime of breach of trust and the crime of embezzlement are sufficiently recognized.

2. The Defendant asserts that, on March 31, 2011, a KRW 6 billion for the transfer price of stocks and management rights was paid to Nonindicted 2, and on the same day, a pledge was established against Nonindicted 3’s deposit amount of KRW 6 billion. Therefore, the Defendant asserts that the act of breach of trust was already committed on March 31, 201, and the crime of breach of trust and the crime of embezzlement constitutes an act subsequent to an inorganic act.

However, in light of the contents of Nonindicted 1 and 7’s each legal statement and Nonindicted 2’s statement on April 7, 2011, the time when KRW 6 billion was paid to Nonindicted 2 appears to have been April 7, 2011. Accordingly, the said assertion is unnecessary.

3. The Defendant asserts to the effect that he was unaware of the fact that shares were offered as security. However, in light of the fact that the Defendant was managing and supervising the overall operation of the company as the representative director of Nonindicted Co. 3, the degree of involvement in the process of loaning KRW 6 billion, and Nonindicted Co. 11’s partial statement in the court, it is reasonable to deem that the Defendant was aware of the fact of offering as security at

Embezzlements up to 6 billion won, the fact of the crime is denied, and the fact that the criminal act in this case was committed during the repeated crime period is disadvantageous to the defendant. However, considering the fact that the defendant appears not to be the actual operator of the non-indicted 3 company, the circumstances leading up to the participation in the crime in this case, and the fact that there is no previous case, the punishment equivalent to the order shall be sentenced to the same degree of punishment (the crime of embezzlement and the crime of breach of trust in this case in the sentencing guidelines for embezzlement and the crime of breach of trust fall under the basic area (4-7 years) among all types (5 billion won, more than 30 billion won, and less than 30 billion won). However, in consideration of the above favorable circumstances, the punishment of imprisonment for

Judges Kim Jae-ho (Presiding Judge)

1) As to the interrogation protocol of a suspect against the Defendant, the Defendant argued that there is no voluntariness since he/she was led to a confession by the prosecutor’s deception. Accordingly, the prosecutor did not prove that he/she resolved the doubts about voluntariness. Accordingly, the admissibility of the interrogation protocol of the Defendant against the Defendant is not recognized (see, e.g., Supreme Court Decision 9Do4940, Jan. 21, 2000).