The only casino operator in South Korea authorised to let locals gamble has only now admitted it committed a “crime” by giving jobs to hundreds of people based on their political connections; a scandal the governing Democratic Party has reportedly labelled “Kangwon Land Gate”, the Korea Times newspaper reported.
The alleged wrongdoing at state-run Kangwon Land Inc – operator of the Kangwon Land casino resort (pictured), a property located in a remote upland area of Kangwon province, 150 kilometres (93 miles) from the capital Seoul – reportedly began six years ago, with a prosecution taking place in 2015.
The currently governing Democratic Party has urged the prosecution to reinvestigate the case as well as the politicians involved in it. The opposition Justice Party has also criticised the handling of the case and is now claiming there was a cover up.
Kangwon Land said in a statement on Tuesday quoted by the Korea Times: “We apologise for committing a crime which would have been possible only in the 1960s or 70s.”
The news outlet said the casino operator had blamed 493 allegedly nepotistic appointments – i.e., where those hired had links either to politicians or other influential people – on former chief executive Choi Heung-jip, who led the state-run enterprise between mid-2011 and early 2014.
South Korea’s current main opposition, the Liberty Korea Party, was the governing party when the misconduct occurred, reported the news outlet.
In 2015, prosecutors had closed a case after indicting only Mr Choi and a human resources official.
“A thing of the past is tarnishing the image of Kangwon Land, which has been trying hard to improve its transparency in recent years… It breaks the hearts of all employees and we are very sorry,” the company added in its Tuesday statement.
Brokerage JP Morgan Securities (Asia Pacific) Ltd said in an August note that the casino operator had been under political pressure to moderate the growth of its revenue. The very existence of a casino that allows South Koreans to gamble on home soil is a hotly debated topic in that country.
In August Kangwon Land Inc had said its net profit for the second quarter of 2017 fell by 10.7 percent from the prior-year period.
“In our view, this seemingly reflects Kangwon Land’s efforts to ‘adjust’ revenues lower amid regulatory scrutiny, and the timing of business normalisation remains frustratingly uncertain,” JP Morgan analysts had noted at that time.
In March, analysts at banking group Morgan Stanley had said – citing guidance from Kangwon Land’s management – that it might have to make a KRW50-billion (US$44.3-million) “donation” to the funding of the 2018 Winter Olympics to be held nearby at Pyeongchang in February that year. The bank said such a payment might result in a “nearly 3 percentage point operating profit margin decline versus 2016”.
Jan 19, 2021Bank automated teller machines (ATMs) with facial recognition technology have been installed since Monday in some places in the mainland China city of Zhuhai, next door to Macau, according to several...
Jan 19, 2021
Jan 19, 2021
"We forecast Grand Lisboa Palace will have EBITDA of HKD2.0 billion (US$260 million) with 330 tables by 2022, and HKD3.5 billion with 380 tables by 2023"
Credit rating agency Fitch Ratings