Casino Operator Kangwon Land Facing Fresh Flak For 2015 Scandal
Kangwon Land Inc, the company which runs the Kangwon Land casino in South Korea has come under fire for a past scandal in which it was found that the company had hired hundreds of employees based on political connections.
The casino is located in an upland province around 150 kilometres (93 miles) away the capital Seoul and is the only casino in the country that allows locals to gamble. A local newspaper Korea Times reported that the practice began around six years ago and prosecution commenced for these violations in 2015.
The current main opposition party, which is the Liberty Korea Party was in power during the time of the scandal. The country’s ruling party, the Democratic Party has urged the prosecution to reopen the case and investigate the politicians involved.
The opposition Justice Party has also criticized the previous handling of the case stating it was a cover up.
The casino operator blamed the previous chief executive Choi Heung-jip for 493 cases of appointments done between 2011 and 2014 due to links with politicians or other high profile individuals. Prosecutors closed the case investigating the misconduct in 2015 after indicting Choi and an executive from the human resources department of the company. Kangwon Land had expressed remorse for the irregularities.
In a statement Kangwon Land said
We apologise for committing a crime which would have been possible only in the 1960s or 70s. 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
This is not the first time that reports of the casino operator coming under political pressure are coming to light. Brokerage firm JP Morgan Securities said in its note in August that the casino operator was being influenced to dampen the growth of its revenue. Kangwon Land reported in August that for the second quarter of 2017 its net profit was down by 10.7 percent when compared to the same period in 2016.
JP Morgan analysts said that the lower revenue could be indicative of the regulatory pressures it was working under. The casino has remained controversial with several gambling opponents objecting to facilities allowing South Koreans to gamble domestically. In March 2017, analysts from investment firm Morgan Stanley noted that the casino operator could possibly be required to make a donation of KRW50 billion ($44.3 million) towards the funding of the 2018 Winter Olympics to be held in the country.
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