![[로펌의기술]⑥’Hangyul’ through the expertise of the 1st trial of Daewoo Shipbuilding and the combined front line of large law firms](https://image.chosun.com/sitedata/image/202102/16/2021021602527_0.jpg "[로펌의기술]⑥’Hangyul’ through the expertise of the 1st trial of Daewoo Shipbuilding and the combined front line of large law firms")
Input 2021.02.17 06:00
Hangyul, only 40 documents and declarations submitted’struggle’
In the first trial of a damages lawsuit filed by institutional investors with “the worst accounting fraud” of Daewoo Shipbuilding & Marine Engineering, which is called the’worst accounting fraud’, legal representative Hangyul (National Pension, Postal Service Headquarters, Teachers’ Pension Service, Public Employees Pension Service) ) Won by defeating large law firms, Plaza, Pacific, and Continental. This is a court decision that came about four years after the lawsuit was filed in July 2016.
The 30th Division of the Civil Agreement of the Seoul Central District Court (President Judge Han Seong-su) dealt with the National Pension Service, Faculty and Employees’ Pension Service, and Public Officials Pension Service’s Daewoo Shipbuilding & Marine Engineering and former CEO Jae-ho Ko, former Chief Financial Officer Kim Gap-jung, and Anjin Accounting Firm. In the lawsuit for claiming damages, some of the plaintiffs ruled in favor.
On the same day, the 31st Division of the Civil Agreement of the Seoul Central District Court (President Judge Kim Ji-sook) also held a first trial of a hand courtship against Daewoo Shipbuilding and Marine Engineering and ruled on some of the plaintiffs.
The total amount of compensation for institutional investors recognized by the two courts was 61.2 billion won. This is only a third of the amount charged by institutional investors (approximately 190 billion won), but after the National Pension Service introduced the Stewardship Code (Law on Trustee Liability) in 2018, institutional investors compensate for damages against companies. It is meaningful in that it has left some prevailing precedents by claiming it.
◇5 trillion won account fraud… Over 120 written declarations and writings were submitted in the dispute for’losses’
Daewoo Shipbuilding & Marine Engineering’s fraudulent accounting case began in 2012. For ongoing projects such as ships, offshore plants, and special ships, Daewoo Shipbuilding & Marine Engineering created by inflating sales by randomly reducing the planned costs differently from the actual project. At the same time, provision for construction loss (Liabilities with uncertain timing or amount of expenditure among losses arising from construction) By reducing the transfer amount, the cost of sales was calculated and submitted as a larger amount than the actual amount.
In addition, the provision for bad debts for long-term receivables that are not likely to be recovered is recorded less than in reality, and the year in which the damage to the bonds, such as investment stocks and loans related to insolvent overseas subsidiaries, was not properly recognized, and thus the impairment loss was underestimated. Swollen.
Daewoo Shipbuilding & Marine Engineering prepared financial statements for 2012-2014 as’false’ as if profits were made despite such losses. It committed a’accounting fraud’ of 5,075.9 billion won based on net assets.
The National Pension Service, Post Office, Faculty and Employees’ Pension Service, and the Public Officials Pension Service are in 2013, the next trading day (after the Liberation Day holiday) from August 14, 2013 when the 14th semiannual report was submitted and publicly disclosed without knowing the facts of preparatory accounting. From August 16, 2016 to April 14, 2016, Daewoo Shipbuilding & Marine Engineering purchased shares.
After that, from July 2015, media reports related to the situation of fraudulent accounting were poured out in earnest, and at the same time, the prosecution investigation began in earnest. Eventually, former Daewoo Shipbuilding & Marine Engineering President Ko Jae-ho and CFO Kim Gap-joong were charged with violating the law on external audit of the stock company and the law on the capital market financial investment business, and were imprisoned for 9 and 6 years in the Supreme Court on December 22, 2017. Has been confirmed. Four public accountants of Anjin Accounting Firm were also sentenced to 1 year and 6 months to 2 years and 6 months in prison on March 27, 2018.
Although he was punished criminally like this, the key to civil affairs was the causal relationship between the stock purchase and the business report, and the calculation of the amount of damage. The range of damages that could be recognized after the three-year exclusion period of damages claims pursuant to Article 162 (1) of the Capital Markets Act was also reduced. The judiciary also rejected the claim for damages related to stocks acquired from August 16, 2013 to March 31, 2014, and from the standpoint of institutional investors, there was inevitably a limit to the amount of the amount actually retained.
It was a’bad condition’, but Hangyol struggled to get recognition for the amount of damage in the remaining period. The unwavering efforts shined even more in court. There were only 40 cases of declaration and documents submitted in the lawsuit, totaling 120 cases of lawsuits from all institutional investors in charge. When it comes to stock investment, Hangyeok put emphasis on the financial statements of business reports and the reliability of the audit reports of accounting firms. In addition, the fact that the stock could not be disposed of due to suspension of trading after Daewoo Shipbuilding & Marine Engineering’s fraudulent accounting was announced in July 2015 was also emphasized by the court.
The judiciary accepts the arguments of the Korean government and the acquisition of stock transactions from April 1, 2014 to the day before July 15, 2015, when the media reports related to Daewoo Shipbuilding & Marine Engineering’s fraudulent accounting were first released, excluding the period after the period for the exclusion of damages claims. Admitted.
The Ministry of Justice “if there is a false entry or indication in matters that may have a significant impact on the rational judgment of investors or the value of Daewoo Shipbuilding & Marine Engineering Co., Ltd. because the degree to which the major items in the financial statements are distorted due to preparatory accounting in this case is significant.” Said.
About Anjin Accounting Firm “It is obligated to jointly compensate for damages incurred from falling stock prices after acquiring shares of Daewoo Shipbuilding & Marine Engineering by trusting in each audit report.“He explained.
The court ruled that Daewoo Shipbuilding & Marine Engineering, former president Ko, former CFO Kim, and Anjin Accounting Firm jointly pay 41.3 billion won to the national pension. In addition, Daewoo Shipbuilding & Marine Engineering and the former CEO of Koo and former CFO Kim ruled that they would pay 5.7 billion won to the Teachers’ Pension Service and 2.9 billion won to the Public Employees Pension Service. It was asked to pay 11.2 billion won to the country that operates the post office. The sum of the winnings of institutional investors totals 61.2 billion won.
◇ “Institutional Investor Representation” Specialized Law Firm Hangyul “Active Litigation Against Companies”
Attorney Kim Kwang-jung (36th Judicial Research and Training Institute), Sang-won Yoon (41th Judicial Research and Training Institute), attorney Lee Yoojin (40th Judicial Research and Training Institute), Soongbeom Heo (37th Judicial Research and Training Institute), and Nam-Joon Park (8th bar exam) at the Plaza The Pacific and Continental won the victory.
Among them, attorney Kim was the first in the history of a lawsuit for damages related to fraudulent accounting in Korea in 2012, when an institutional investor filed a lawsuit against a corporation and an accounting firm at the same time, in the case of’Hansol Syntec’, the National Pension, Civil Service Pension, Private School Pension, Post Office , Credit Union Federation, and four asset management companies were represented on behalf of nine institutional investors and won a judgment.
Attorney Kim said, “When institutional investors suffered losses due to corporate fraudulent accounting, they usually filed a claim against the asset management or accounting firm, and there was no case against the company.” Since then, the Daewoo Shipbuilding & Marine Engineering incident is the second case.”
He added, “I hope that the accumulated winning experience will provide an opportunity for other institutional investors to take strong and proactive measures in the future if they lose money through corporate fraudulent accounting.”