Golden Spoon Investment Portfolio - Chapter 522

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This chapter was translated by Lunox Novels. To support us and help keep this series going, visit our website: LunoxScans.com
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522. Why has the Public Security Bureau come here?

[Daekwang Group Due Diligence Reveals Large-Scale Accounting Fraud
According to the Creditor Consortium’s due diligence, Daekwang Group’s current assets stand at 17.4586 trillion won, a staggering decline of 11.7444 trillion won from book value, while liabilities have ballooned to 31.9944 trillion won—an increase of 5.435 trillion won.
As large-scale accounting fraud continues to surface not only at Daekwang Group but across its affiliated subsidiaries, the projected loss burden for the workout program has grown substantially beyond initial estimates, deepening the Creditor Consortium’s concerns. Meanwhile….]

Every morning newspaper that came out today plastered the Daekwang Group accounting fraud story across its front page. Seok-won, seated at his spacious desk, murmured softly to himself.

“Finally, the hidden bomb has been exposed.”

What had been revealed was merely the tip of the iceberg.
Unlike other conglomerates, Daekwang Group had continuously acquired struggling companies to expand its scale, making it inevitable that borrowing would balloon.

“Normally, one would pause expansion and normalize acquired companies while strengthening fundamentals, but Chairman Yu Chun-seok chose the easier, simpler path instead.”

That was to reduce debt and inflate net profits, transforming a company in actual capital erosion into one appearing profitable.

“When the full scope of the scandal came to light, what shocked people even more was that Chairman Yu Chun-seok had directly instructed specific figures and was deeply involved in the accounting fraud, and that this fraudulent accounting had been occurring for a full twenty years—long before the foreign exchange crisis struck.”

In short, what appeared to be a perfectly sound second-ranked conglomerate was nothing but a castle built on sand.
Continuing to manipulate accounts in this precarious balancing act, when the enormous tsunami of the foreign exchange crisis crashed down, Daekwang Group—which had been operating through borrowed capital from banks—faced a catastrophic crisis.

“So what Chairman Yu Chun-seok chose was not austerity, but to employ accounting fraud on an even larger and broader scale to conceal the rot.”

Over two years from 1997, Daekwang Group manipulated losses into profits totaling a staggering 41 trillion won.

“What’s even more astounding is that using these falsified accounting books, they secured an additional 10 trillion won in loans from the financial sector.”

It was remarkable that such blatant misconduct had gone undetected until now.

“No matter how much leveraged financing was considered standard practice among Korean companies before the foreign exchange crisis, Chairman Yu Chun-seok’s actions crossed the line—and then some.”

The most infuriating part was that tens of trillions of won that had simply vanished into thin air would ultimately have to be covered by taxes paid by ordinary citizens.

“He must know well that what he’s done cannot be forgiven, no matter how powerful a conglomerate chairman he is. He must have fled overseas before the accounting fraud was exposed.”

Seok-won wore a bitter expression, fully aware that despite committing such egregious crimes, Yu Chun-seok would travel abroad with embezzled funds, face no punishment, and live a life of luxury along with his family.
In his previous life, Yu Chun-seok had been sentenced to eight years and six months in prison, along with a confiscation order of 17.9253 trillion won—the largest amount in South Korean history—for charges including accounting fraud at Daekwang Group subsidiaries, fraudulent loan instructions, and overseas asset concealment.
However, after more than five years of fleeing abroad, he returned and was released within mere months through a special pardon.
Moreover, while living a luxurious life with his family, he paid only 89.2 billion won—less than one percent of the confiscation order—until his death from old age.

“The fact that even those 89.2 billion won were recovered wasn’t because Yu Chun-seok paid them voluntarily, but because investigators finally tracked down assets he’d hidden under false names after relentless pursuit.”

Seok-won gazed down at the black-and-white photograph of Yu Chun-seok in the newspaper with cold, piercing eyes.

“Before the regression, he slipped away like a loach and lived a luxurious life abroad in hiding, but this time, that won’t be possible.”

When his phone vibrated, Seok-won checked the name on the screen and answered the call.

[Day Sai.]

Hearing Liu Shangfu’s voice, Seok-won responded in fluent English.

“I was just about to contact you, but you called first.”
[Hahaha. Is that so? It seems telepathy works between us brothers.]

Liu Shangfu, who had begun treating Seok-won as family—as a xiongdi—rather than merely a friend since the incident with Chairman Zhang Daming that had shaken Fujian Province not long ago, spoke with warmth.

[I’ve already spoken with the Yantai Mayor, so the Public Security Bureau should arrest Yu Chun-seok sometime today.]

A smile bloomed on Seok-won’s lips as he held the phone to his ear, hearing the news he’d been waiting for.

“Thank you for helping with such a difficult request.”
[It worked out smoothly because the Yantai Mayor has been close to my father since his time—he’s like an older brother to us. Plus, when he learned that Daekwang Group was entering dissolution proceedings in Korea, he readily agreed to help.]

Given that Daekwang Motors had made substantial investments in Yantai, including establishing an engine manufacturing plant, the mayor and Public Security Bureau would normally have protected Yu Chun-seok and facilitated his escape.

‘Yu Chun-seok must have believed in that protection, which is why he’s remained in Yantai, monitoring the domestic situation.’

However, as Seok-won exerted his influence behind the scenes, the situation had shifted entirely.
From the Yantai Mayor’s perspective, with accounting fraud exposed and Daekwang Group’s dissolution now certain, protecting Yu Chun-seok—who had become a severed thread—was far less advantageous than establishing new relations with Seok-won, the world’s wealthiest man and a titan of Wall Street.

‘With the chaos from accounting fraud and restructuring, there’s every reason to help—especially since he could quietly seize the newly constructed engine manufacturing plant that Daekwang Motors created.’

In fact, Yantai Mayor was considering arresting Chairman Yu Chun-seok, who was currently in hiding, by fabricating various charges, and then seizing his stake in the engine manufacturing plant.
In China, where power superseded law, it was effortless to manufacture criminal charges against Chairman Yu Chun-seok.
Even if that weren’t the case, bribery was standard practice for accomplishing anything in China, and given how authorities routinely overlooked various loopholes and illegalities in pursuit of rapid economic growth, the Public Security Bureau could easily uncover damning evidence if they decided to investigate thoroughly.

I found it somewhat regrettable to lose the newly constructed engine plant, but if I could recover even half of the confiscation order exceeding 17.9 trillion won by having him captured quickly without prolonged overseas evasion, it would still be an excellent transaction.

Seok-won adjusted his grip on the phone and spoke.

“Thanks to this, acquiring the target company should proceed smoothly.”
[Glad it worked out. I’ll be in touch.]

Liu Shangfu, laughing heartily, ended the call first.
As Seok-won set down his phone and leaned back, his lips twisted into a cold smile.

“Committing accounting fraud to secure astronomical amounts through fraudulent loans wasn’t enough. While the group crumbles and employees are left to fend for themselves, he schemed to siphon company funds for his own survival. He deserves to face the full consequences of his crimes.”

* * *

Yantai, Shandong Province, China.
As one of ten ports opened by the Treaty of Tientsin following the Opium War, the city had once hosted British and German concessions, leaving it dotted with aged Western-style buildings throughout its districts.
At the Royal Suite Hotel in the city center, Chairman Yu Chun-seok had been unable to return to Korea and had remained there for over two weeks.

“I believe it would be wise to relocate to another location, sir.”
“What?”

Chairman Yu Chun-seok, draped in a gray cardigan and seated on a leather sofa, furrowed his brows and looked up.
Chief Secretary Oh Chang-hak, who had flown urgently from Korea today, opened his mouth with a grave expression despite the irritation evident in the chairman’s gaze.

“The Financial Supervisory Service concluded from preliminary investigations that accounting fraud allegations are substantial, and has initiated intensive special audits not only of headquarters but also of twelve affiliated companies under workout status and accounting firms.”
“I see.”
“Simultaneously, they intend to report you to the Prosecution and pursue both civil and criminal liability.”
“Damn it!”

Hearing Chairman Yu Chun-seok curse harshly, Oh Chang-hak continued cautiously.

“In the worst case scenario, the Prosecution may revoke your passport and request that the Chinese government arrest and extradite you.”

Chairman Yu Chun-seok’s face hardened as he gripped the sofa’s armrest tightly and asked.

“What did Representative Choi and Representative Kim have to say?”

Oh Chang-hak, the Chief Secretary, shook his head with a darkened expression.

“The matter has grown too large. They indicated they would find it difficult to assist and are drawing a line.”
“These shameless bastards!”

Yu Chun-seok crumpled his face and erupted in fury.

“They were more than happy to pocket the bribes, but now that everything’s falling apart, they pretend not to know anything!”
“The Blue House continues to pressure you to return immediately.”

Though betrayal gnawed at my teeth, the priority now was to flee to somewhere safer, away from the Prosecution’s investigation.

“Ungrateful wretches! I won’t forget this.”

Yu Chun-seok, his face filled with rage, clenched his lips tightly and spoke to Oh Chang-hak.

“The United States and Europe would be too risky. Where would you suggest?”

Oh Chang-hak, as if he had already considered this, answered immediately.

“What about Vietnam, sir?”
“Vietnam?”

As I narrowed my brow and looked at him, Oh Chang-hak leaned forward and began to explain.

“It’s a nation with no extradition treaty with Korea. Moreover, because we’ve designated Vietnam as our strategic base in Southeast Asia and made consistent investments there, we’ve cultivated deep relationships with government officials. They will certainly protect you, sir.”

Indeed, Daekwang Group had not only entered Vietnam faster than any other domestic company but had invested tens of billions of dollars, maintaining special relations with both the Vietnamese government and the Communist Party.

“And if you go to Vietnam, you can utilize the Group’s assets and cash reserves there, which will be of great help in your daily needs.”

Oh Chang-hak lowered his voice slightly and whispered.
Yu Chun-seok, arms crossed, pondered for a moment before nodding slightly.

“It seems reasonable. Discreetly inquire whether it’s acceptable to go to Vietnam, and once we get the green light, we’ll proceed immediately.”
“I’ll proceed accordingly.”

It was pitiful to have become a fugitive, forced to flee here and there overnight, but survival was what mattered now.
I firmly believed that once enough time had passed, I could rebuild the collapsed group using the assets I had secretly set aside in advance.
Just then, the doorbell rang from outside, and the attending secretary who had been waiting quickly moved toward the guest room door.
When Yu Chun-seok saw the attending secretary return in a panic with a bewildered expression, he asked with an irritated face.

“Who is it?”
“It’s the Public Security Bureau.”

At the arrival of this unwelcome visitor, Yu Chun-seok’s brow furrowed deeply.

“Why is the Public Security Bureau here?”
“They won’t say. They’re just demanding we open the door. What should we do?”

At the same moment, rough knocking echoed from outside, as if urging them forward.
Though an ominous feeling crept over him, Yu Chun-seok deliberately ignored it and spoke.

“Open it.”
“Understood.”

As the attending secretary opened the guest room door, uniformed Public Security Bureau officers stormed in with heavy, thundering footsteps.

“You are Yu Chun-seok, correct?”

Among roughly a dozen Public Security Bureau officers lined up, the man who appeared to be in charge asked with a cold gaze.

“I am.”

Yu Chun-seok, feeling displeasure, furrowed his brow and answered in English, whereupon the man pulled a warrant from his front pocket and unfolded it.

“You are under arrest for illegal disposal of manufacturing plant waste and wage default.”
“That’s complete nonsense!”

Yu Chun-seok’s face hardened rigidly as he shouted in outrage, but the Public Security Bureau officers paid no heed and approached, snapping handcuffs onto both his wrists.

“Chairman, Chairman!”
“What is this…?”

The bewildered Oh Chang-hak and the attending secretary cried out, but they were blocked by the officers and could do nothing.
Surrounded by the Public Security Bureau officers, Yu Chun-seok felt the cold touch of the handcuffs and instinctively realized that something had gone terribly wrong.

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This chapter was translated by Lunox Novels. To support us and help keep this series going, visit our website: LunoxScans.com
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