A South Korean court Tuesday ruled for a second time that Hyundai Motor Chairman Chung Mong-koo does not have to go to prison for embezzlement and breach of trust, leaving the auto tycoon free to keep running the aggressively expanding automaker.The Seoul High Court upheld a sentence last year in which it suspended the three-year prison term handed Chung by a lower court. The latest ruling the 70-year old executive can avoid time in jail as long as he breaks no laws for five years.

Presiding judge Kil Ki-bong said Chung used most of the embezzled funds for his company and "did not seek personal profits" as a reason for suspending the prison term. The judge said Chung's promise to donate personal assets to society was also a mitigating point. Chung has promised to donate 1 trillion won ($985 million) worth of assets to charity in an apparent attempt to seek leniency from the court.



The Seoul High Court was forced to issue a new sentence because prosecutors appealed one aspect of its earlier decision: that Chung deliver lectures and write newspaper articles on lawful business management for the community service portion of his sentence.

In Tuesday's ruling, the high court ordered Chung to do 300 hours of community service in the form of environmental protection and other activities instead of the lecturing and writing.

Attention was focused on the outcome of the resentencing as it was theoretically possible for the court to change Chung's sentence and send him to prison.

But chances of that were considered low because prosecutors disputed only the community service aspect, not Chung's suspended term.

"I will abide by" the ruling, a smiling Chung told reporters as he left the court.

"We are greatly relieved that this case is finally over," Hyundai said in a statement. "We can now focus all our energies on making the Hyundai-Kia Automotive Group a global leader, one which is responsive and responsible to the demands of all of our stakeholders."

Choi Jae-kyong, a lead prosecutor in the case, said he has yet to read the verdict, but added that the prosecution is unlikely to appeal the decision to the Supreme Court.

Tuesday's court hearing was disrupted briefly as a protester who claimed to be a non-regular Hyundai worker shouted in the courtroom, demanding Chung's imprisonment. He was later taken out of the room.

Non-regular workers refer to outsourced, part-time or contract workers whose job security and other benefits are usually worse than those of regular workers.

Hyundai Motor Co. and affiliate Kia Motors Corp. together form the world's sixth-largest automative group, is a key driver of South Korea's economy.

Chung was found guilty in February last year on charges that he raised a 103.4 billion won ($102 million) slush fund from affiliates. Prosecutors said much of the money was used to pay lobbyists to gain government favors and for personal use.

He received a three-year term in the initial district court trial, but the high court suspended the sentence for five years. The presiding judge said at the time that Chung was too important for the nation's economy to go to prison.

Both companies are expanding aggressively overseas. Kia is currently building its first U.S. factory in the state of Georgia. Hyundai already has a plant in nearby Alabama.

Hyundai shares declined 4.9 percent Tuesday to close at 79,300 won ($78).

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