ClickAJob News

The chairman of Korean car maker Hyundai has avoided jail after being convicted of embezzling company funds.

A South Korean appeal court told Chung Mong-koo today that he would instead be handed a three-year suspended sentence after being found guilty of channelling $100 million (£53 million) of company money into a series of slush funds.

Chung, 69, was convicted in February after he was arrested over claims that he had set up the funds in order to pay for political favours.

He had been freed on bail pending appeal.

Today's decision by a Seoul court to quash the three-year jail sentence originally handed down to the Hyundai chief leaves Chung free to return to work at the world's sixth-largest car maker.

In announcing the decision the presiding judge said he had taken into account "the huge economic impact" putting Chung in prison would have.

Hyundai controls 70 per cent of the South Korean auto market and accounts for 5.4 per cent of the country's GDP. Analysts had warned that the case against Chung had damaged the company's corporate image and had hampered plans for its international growth.

"The court has been agonising over whether to put the accused in jail or keep him out of prison," said chief judge Lee Jae-Hong.

"But in consideration of the huge economic impact that could result from imprisonment, it decided to suspend the sentence."

In a statement following the decision Hyundai said that it was "greatly relieved" that the matter was finally over.

"We can now devote our full energies to addressing the numerous challenges that face us in building a global brand," the car maker said.