SEOUL, Feb. 21 (UPI) — A Tokyo-based holding firm of retail giant Lotte Group accepted the resignation of its jailed chairman Shin Dong-bin after he was found guilty of bribery and embezzlement.
In a board meeting on Wednesday, Lotte Holdings officials decided to accept Shin’s offer to step down as chairman of the South Korean-Japanese company, NHK World reported.
The firm explained that it is a customary practice in Japan to dismiss a chairman upon arrest, even before a verdict is reached.
However, Shin will keep his board membership and his vice chairman title while his co-CEO Tsukuda Takayuki will solely head the company.
Shin was put behind bars last week, after a South Korean court sentenced him to 30 months in prison in connection with the corruption scandal that ousted the country’s former President Park Geun-hye.
The ex-CEO was charged with offering some $6.5 million in bribes to a sports foundation headed by Choi Soon-sil, Park’s long-time confidante, in return for Lotte Group’s duty-free business.
With his absence, South Korea’s Lotte Group expressed concerns that cooperation with Japan’s Lotte Holdings may weaken, Chosun Ilbo reported.
“We will continue to communicate with Japan’s Lotte Holdings to overcome the situation,” the group said.
Also, the company said that Shin’s older brother Shin Dong-joo would not regain his position at Lotte Holdings, addressing speculation that the two siblings’ long-standing rivalry may resurface.
Shin Dong-joo has claimed he is the rightful successor of the Lotte business empire, founded by their father, Shin Kyuk-ho.
In 2015, the elder Shin was dismissed from his position as vice chairman of Lotte Holdings due to poor managerial performance. Since then, he has made a series of attempts to remove his younger brother from the board.
On Wednesday, Shin Dong-joo called for his brother to forfeit his position as director of the board, deeming the company’s decision to maintain his boardroom presence “socially unacceptable,” Yonhap reported.