June 21, 2014 / 4:51 AM / in 3 years

UPDATE 1-Ferry sinking: South Korea closes net round family of most wanted man

(Adds ferry company employees in court)
    SEOUL, June 21 (Reuters) - The wife of South Korea's most
wanted man, a businessman linked to a ferry disaster in which
hundreds of school children drowned, was arrested on Saturday,
prosecutors said, as the net tightens around the fugitive's
family.
    Police and prosecutors arrested Kwon Yoon-ja, 72, on
suspicion of embezzlement after chasing her for more than 20
days, an official said.
    Prosecutors and police are seeking Yoo Byung-un, 73, who has
eluded one of the country's biggest manhunts for more than a
month. The husband of Yoo's younger sister, a former ambassador
to the Czech Republic, was arrested on Friday on suspicion of
helping Yoo escape arrest.
    Yoo is wanted on charges of embezzlement, negligence and tax
evasion stemming from a web of business holdings centred on
I-One-I, an investment vehicle owned by his sons that ran the
shipping company, Chonghaejin Marine.
    Chonghaejin owned the Sewol, which sank off the southwest
coast on April 16 killing more than 300 people, many of them
school children, on a routine journey from Incheon on the
mainland to the southern holiday island of Jeju.
    Authorities suspect Kwon, who owns one of Yoo's subsidiary
companies that sells health supplements, poured funds into
companies owned by her husband and son. 
    Reporters bombarded her with questions - "Are you in contact
with your husband?" "Do you plead guilty to all charges?" "Why
have you been hiding?" "Do you know where your husband is?"
    She did not reply.
    The sinking of the Sewol was a disaster that prompted a
national outpouring of grief and anger, especially after some
crew were caught on video abandoning ship while the children,
following instructions, stayed in their cabins.
    Five Chonghaejin employees, including company boss Kim
Han-sik, pleaded not guilty to criminal negligence in court on
Friday.
    "I feel strongly about the responsibility I have as chief
for an accident that caused massive casualties," Yonhap news
agency quoted Kim as saying. "But I have doubts that it was my
fault the ferry sank and left so many people dead."
    Yoo's elder brother, Yoo Byung-il, has been arrested on
charges of embezzlement and violations of real estate laws. His
daughter, Yoo Som-na, has been held in France after Interpol
called for her arrest "for fraud and embezzlement".
    Yoo, a photographer who once had an exhibition at the Louvre
in Paris, was once jailed for fraud, has eluded capture in a
case which has become an embarrassment for authorities already
under pressure for their handling of the disaster.
 
    Police and prosecutors twice raided the compound of a
religious sect he co-founded, using earth movers to search for
tunnels, but to no avail. 
    Authorities have offered a half-million-dollar reward for
Yoo, the maximum allowed for an individual in a criminal case.
    Lawyers for the 15 surviving crew of the Sewol, who face
charges ranging from homicide to negligence, argued on Tuesday
that it was up to the coastguard to rescue the passengers, not
them.

 (Reporting by Ju-min Park and Narae Kim; Editing by Nick
Macfie)

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