Korean Air’s headquarters in Gangseo-gu, Seoul, was raided by police on Friday morning related to suspicions that the company’s chairman embezzled funds allocated for the construction of a new hotel in Incheon to use for the decoration of his private home.

The raid, which targeted Korean Air’s materials division, led to the seizure of contracts and financial documents related to the hotel’s construction process. 

Chairman Cho Yang-ho’s home in Jongno-gu, Seoul, underwent construction between May 2013 and August 2014. Police suspect that a significant portion of the funds involved were taken from the company’s coffers.

The amount allegedly embezzled has not been determined yet.

According to news reports, the police discovered the possibility of Cho’s involvement while investigating tax fraud by a company that often takes on home renovation projects for the heads of conglomerates.

“We will cooperate fully with the police investigation, and are working internally to clarify facts in this situation,” said a spokesman for Korean Air. 

By Won Ho-jung (hjwon@heraldcorp.com)