1 Trillion Won New Apartment System Furniture Bid 'Collusion'... 4 Companies on Trial

[Financial News]  The prosecution has brought four companies to trial on charges of winning a 1 trillion won new apartment system furniture construction project through bid collusion. They are also accused of exchanging money and goods in return for so-called 'proxy bidding'.
According to the legal community on the 27th, the Seoul Central District Prosecutors' Office's Fair Trade Investigation Department (Chief Prosecutor Kim Yong-sik) indicted three corporations, including Dongsungsa, SpaceMax, and Jamat, and three top executives of each company on charges of violating the Construction Industry Basic Law and the Fair Trade Act related to bid collusion on the 4th without detention.
In addition, three companies, including Dongsungsa, SpaceMax, and JC, and three top decision-makers of each company were additionally charged without detention on the 25th for violating the Construction Industry Basic Law related to proxy bidding.
According to the prosecution, Dongsungsa, SpaceMax, and Jamat are accused of agreeing in advance on the successful bidder or bid price for a total of 105 system furniture bids ordered by 10 domestic construction companies from February 2012 to November 2022. The winning amount is estimated to reach 120.3 billion won.
After receiving a report from the Fair Trade Commission on the violation of the Fair Trade Act by these corporations, the prosecution launched an investigation and, through searches and investigations of related parties, found that Dongsungsa CEO A, SpaceMax Chairman B, and Jamat CEO C had finally approved the collusion and brought them to trial.
Through further investigation, the prosecution also revealed that Dongsungsa, SpaceMax, and JC exchanged a total of 1.05561 billion won in money and goods under the pretext of participating in proxy bidding for two system furniture bids from April 2016 to September 2020. The payment was disguised as if there had been a goods transaction to avoid the eyes of regulatory authorities.
These companies also paid part of the expected construction profits to companies participating in the bid as proxies and provided compensation by requesting the successful bidder to change the winning order.
The prosecution announced that it applied charges of violating the Construction Industry Basic Law to Dongsungsa, SpaceMax, JC, and three executives and employees of each company and merged the cases for trial.
However, in the case of Hanssem, the prosecution plans to consider the progress of the related companies' trials in the future according to the leniency system, which reduces penalties such as fines and corrective measures if the first participant in collusion voluntarily reports.




kyu0705@fnnews.com Kim Dong-kyu Reporter