STX fraud probe widens

A former senior South Korean tax official has been charged with taking bribes from STX Group.

Song Kwang-jo allegedly took a total of KRW 10m ($9,800) from a former STX chief financial officer in return for favours during a tax audit of the shipping and shipyard group.

Prosecutors told the Yonhap news agency that Song was working as an audit official of the National Tax Service and heading the Busan regional tax office at the time.

The 52-year-old has not been detained.

Song resigned from his post in 2013 after being accused of having free golf outings in return for helping food and entertainment conglomerate CJ Group avoid an audit.

STX group founder Kang Duk-Soo has already been charged with embezzlement and business malpractice as his shipping and shipyard empire crumbled.

Kang, 64, who stepped down in February, is accused of diverting funds from STX Heavy Industries to illegally support other ailing affiliates, chiefly STX Construction.

Investigators at the Seoul Central District Prosecutors' Office also alleged that Kang embezzled company funds to invest in his personal company by setting up a paper operation.

And he is further accused of creating a secret fund by inflating salary figures paid to company executives, prosecutors said.

The prosecution claims the value of the alleged frauds is $2.4bn.

But Kang was cleared of a charge of using company money to bribe politicians.

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