May 11, 2018 12:17
Korean Air chief Cho Yang-ho has resigned as CEO at budget affiliate Jin Air amid a snowballing scandal that is battering his family and every part of his Hanjin Group empire. He keeps his board position.
Jin Air said current president Kwon Hyuk-min has been appointed as new CEO as part of reforms to appoint professionals who are not members of the founding family to top positions.
But the decision comes after revelations that Cho put his temperamental daughter Hyun-min in a board position at the budget carrier without declaring to authorities that she is an American citizen.
Industry watchers believe Jin Air is trying to avoid losing its flight license by ousting him.
The scandal has now fully engulfed Cho senior. Prosecutors said Thursday they have launched an investigation into alleged slush funds he squirreled away.
The Seoul Southern District Prosecutors' Office said, "The Korea Financial Intelligence Unit has informed us of suspicious flows of money at Korean Air and we are looking into the possible creation of slush funds."
Authorities are also investigating the Hanjin chairman and his three siblings for inheritance tax evasion.
Cho's wife is under investigation over a luxury goods-smuggling racket together with her two daughters, while police are also looking into allegations that she assaulted staff, as is Cho Hyun-min. The older daughter, Hyun-ah, was convicted of assault in the "nut rage" scandal of 2014.
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