Kim's Fall From Grace At Daewoo

What an ignominious fall. As recently as two years ago, Kim Woo Choong, founder of South Korea's Daewoo Group, was revered as the man who built a small textile-trading house into Korea's second-largest industrial conglomerate. Since then, revelations of deep losses, corruption, and mismanagement at Daewoo have shredded his legend. Now the last vestiges of respect are gone.

In the first week of February, the Supreme Public Prosecution Office, Korea's top law-enforcement agency, announced it had arrested seven of Kim's top lieutenants on four criminal charges, including fraud and embezzlement. They were jailed to await formal indictment and trial. Those in custody include top current and former executives of the group's many divisions, among them Kang Byung Ho and Chang Byung Ju, ex-presidents of Daewoo Corp., and Kim Tae Gou, former chairman of Daewoo Motor. Kim Woo Choong, whose empire once produced 10% of South Korea's gross domestic product, is a fugitive, flitting between Europe and Africa to avoid prosecution on charges including fraud and embezzlement.