Cha Ga-won: "Defrauded of 30 billion won? I received the money, but there was no intent to deceive" – Witness examinations begin in December [Comprehensive]

*This content was translated by AI.View Original

At the second trial for Cha Ga-won, Chairman of Peak Group and CEO of entertainment agency One Hundred Label, who was indicted on charges of fraud involving approximately 30 billion won, he denied most of the allegations of misappropriation. Witness examinations are expected to proceed at the next hearing.

The Criminal Division 23 of the Seoul Central District Court held the second trial for Cha Ga-won on charges of violating the Act on Aggravated Punishment of Specific Economic Crimes (fraud).

On this day, Cha Ga-won attended with his legal counsel.

The court confirmed that Cha Ga-won’s side had expressed no desire for a citizen participation trial and denied the facts alleged in the indictment, stating they would explain their reasons later. It also noted that they requested the dismissal of the compensation order application filed by Jang, a victim of a jeonse (lump-sum deposit) lease dispute, for 5.41 billion won. The court further stated, "We did not accept the request to change the trial date on the grounds of replacing legal counsel."

The court then addressed the prosecutor regarding the facts alleged in the indictment concerning Jang, stating, "For the sake of the defendant’s right to defense, it seems necessary for the details of the deceptive acts to be presented. While the facts alleged in the indictment will be confirmed after witness examinations, you must specify them clearly to some extent."

Subsequently, Cha Ga-won’s side stated, "We acknowledge receiving funds from Knowmerce and Jang," but added, "There was no deception as described in the facts alleged in the indictment during the process of receiving the funds, nor was there any intent regarding such deception." They further explained, "In our relationship with Knowmerce, we followed previously established normal methods. We had also agreed that a new contract would begin upon termination of the previous one, but we did not provide a definitive answer as to when this new contract would start." They added, "We never stated that there was a substantive preliminary agreement with fromis_9, and the contract explicitly noted that if it was not with fromis_9, such a contract could be made with other artists."

The prosecutor then requested witness applications for three individuals at the next hearing. It was also decided to conduct witness examinations of Jang, and the next hearing was set for December 7.

Previously, the Tax Crime Investigation Division of the Seoul Central District Prosecutors’ Office indicted Cha Ga-won on August 25. The Financial Crime Investigation Team of the Seoul Metropolitan Police Agency’s Major Case Investigation Division had referred him to the prosecution service in custody on the 7th of the same month.

Cha Ga-won is suspected of proposing a business utilizing the intellectual property (IP) of his agency’s artists to Knowmerce Inc., signing a contract, and receiving an advance payment of 24.2 billion won, but failing to actually carry out the business. The scale of the damage was reported to be approximately 30 billion won.

He is also suspected of promising to sign mutual jeonse lease contracts for houses owned by himself and acquaintances, receiving a deposit of 5.4 billion won, but failing to fulfill the contract. However, Cha Ga-won’s side denied the allegations, characterizing them as part of a hostile mergers and acquisitions (M&A) conspiracy against One Hundred Label.

At the previous first trial, Cha Ga-won appeared in court while in custody, wearing black clothing and a mask.

The prosecution explained, "The defendant defrauded 5.5 billion won under the pretext of an advance payment by promising to give the vice-chairman of Knowmerce a performance contract for his artist Taemin. He defrauded the same amount by promising a merchandise distribution contract (for Taemin). Additionally, he defrauded 12.1 billion won by promising a merchandise production and distribution contract for EXO-CBX. He is also suspected of defrauding 1.1 billion won through false promises regarding business related to fromis_9."

The prosecution further explained that Cha Ga-won defrauded 5.2 billion won by having his artists take out jeonse loans and promising them move-in arrangements.

Cha Ga-won’s legal counsel stated, "We deny all the facts alleged in the indictment." However, they noted that time is needed to review relevant records, so opinions on evidence will be presented at the next hearing.

Subsequently, Cha Ga-won’s side requested the court to dismiss the compensation order applied for by Ms. Jang (a victim of jeonse deposit misappropriation).

In response, Cha Ga-won’s side argued, "It is questionable whether [Ms. Jang] can be considered a victim, as she is a person with the right of priority and authority to take over under the Housing Lease Protection Act." They claimed, "Since repayment is possible through the villa (multi-family housing), we maintain that neither deception nor a claim for damages should be upheld. The explanation regarding the relationship between the deceptive acts and the amount defrauded seems insufficient."

On the other hand, Ms. Jang’s side countered, "[Ms. Jang] was actually defrauded," stating, "The value of the villa in question is not high, and a significant amount has been secured by senior liens and mortgages. In the event of cashing out through auction or similar means, the amount the victim can recover would be small."

Cha Ga-won is the former chairman of real estate development company Peak Group. He co-founded One Hundred Label with MC Mong in 2023. His agency’s artists included The Boyz, Lee Seung-gi, Lee Mu-jin, VIVIZ, and EXO-CBX, but they filed a series of lawsuits, including termination of exclusive contracts, due to issues with unpaid settlement funds.

Chairman Cha is also known to have filed a lawsuit against MC Mong, who left the company after conflicts, seeking the return of a loan amounting to 12 billion won.

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*This content was translated by AI.View Original