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(LEAD) Fugitive Sewol owner's brother-in-law to stand trial

All Headlines 22:20 June 24, 2014

(ATTN: RECASTS throughout with court approval of arrest warrant of fugitive owner's wife)

INCHEON, June 24 (Yonhap) -- The brother-in-law of the fugitive billionaire who owns the sunken ferry Sewol has been indicted on charges of breach of trust, prosecutors said Tuesday, making him the first among the owner's relatives to stand trial over alleged corruption that officials suspect led to the ferry disaster.

Kwon Oh-kyun is accused of funneling funds of nearly 30 billion won (US$29.4 million) into his business after taking out loans with assets of a mysterious religious group as collateral in 2010, according to prosecutors.

The religious group, the Evangelical Baptist Church, was established by Kwon's father and brother-in-law Yoo Byung-eun, the fugitive owner of Chonghaejin Marine Co., the operator of the ill-fated ferry that sank off the country's southwest coast on April 16.

Prosecutors suspect that corruption by Yoo's family resulted in lax safety practices, such as cargo overloading, which ultimately led to the tragedy that left more than 300 people dead or missing.

As well as being an influential member of the church, Kwon acts as the chief of Trigon Korea, a local builder and core affiliate of Chonghaejin Marine, prosecutors said.

Also Tuesday, prosecutors said they have sought an arrest warrant for Yoo Byung-ho, the younger brother of Yoo Byung-eun, on charges of embezzlement.

The younger Yoo is suspected to have borrowed 3 billion won from one of the affiliates run by his elder brother's family. He allegedly made members of the religious group pay back 1.5 billion won on his behalf while the affiliate suffered losses of 1.5 billion won.

The younger Yoo was nabbed inside his home in Daegu, a city about 300 kilometers south of Seoul, on Sunday.

Meanwhile, the district court in Incheon approved an arrest warrant for Kwon Yun-ja, the wife of Yoo Byung-eun, citing concerns that she may try to flee or destroy evidence. Incheon is a port city just west of Seoul.

Kwon was apprehended inside an apartment in Bundang, just south of Seoul, on Saturday. She was also charged with breach of trust.

The authorities have been offering 500 million won as a reward for information leading to the capture of Kwon's husband, Yoo Byung-eun. He is still at large despite a massive manhunt across the country.

The church, led by Yoo Byung-eun, is widely considered a cult and has some 20,000 followers. Prosecutors suspect that funds from church members were used for businesses run by Yoo's family.
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