The arrest of Hanwha Group Chairman Kim Seung-youn has refocused attention on business practices at South Korea's family-run industrial conglomerates, or chaebol, tainted by a series of accounting frauds and slush fund scandals.

However, this time, the charges are not white-collar ones.

Late Friday, the Hanwha chairman was thrown into jail on charges of allegedly beating up bar workers in early March in apparent revenge on behalf of his 22-year-old son, who suffered a facial injury at the hands of the off-duty bar employees in a scuffle at a karaoke club.

Surrounded by company guards and some members of organized crime syndicates, Kim used his fists and steel pipes to assault the bar workers after abducting them and bringing them to a vacant building outside Seoul, according to media reports.

After initial denials, Kim, 55, acknowledged some of the suspicions. Until Kim was jailed, Hanwha lawyers and public relations executives had been mobilized to save their chairman.

Hanwha is South Korea's 10th-largest conglomerate with business interests ranging from weapons and construction to life insurance.

"In this case, you can clearly see the overall problems of a chaebol management system," said Kwon Man-hak, an international management professor at Kyung Hee University. "The incident refocused attention on the danger of emperor-like management style." Over the decades, South Korea's chaebol such as Samsung, SK and Hyundai Motor have been accused of building their business empires, fueled by government-backed massive borrowing in return for bribes to leading politicians and bureaucrats.

In the wake of the 1997-98 Asian financial turmoil, however, the chaebol tycoons have been under pressure to reform their corporate governance and make business decisions more transparent.

Since then, the government has forced many bloated chaebol to slim down and banned cross-funding among chaebol subsidiaries.

However, many agree chaebol reform cannot be done overnight.

In 2003, Chey Tae-won, chairman of SK Corp., was convicted of involvement in a US$1.3 billion accounting fraud at an SK affiliate.

Samsung Chairman Lee Kun-hee has been criticized for allegedly engaging in illicit father-to-son wealth transfers. Hyundai Motor Chairman Chung Mong-koo was convicted in early February of illegally raising $110 million in slush funds and bribing government officials to get business favors.

Despite such corporate malfeasance cases, the top executives are still in charge of the conglomerates and their influence runs deep.

South Korea's top four chaebol -- Samsung, Hyundai Motor, SK and LG -- account for almost half of the nation's exports and some 42 percent of gross national product.

"Since the Asian financial crisis, numerous attempts were made to reform chaebol," said Kim Sang-jo, head of the Solidarity of Economic Reform, a civic organization for minority shareholders.

"However, pressures from outside have made little change in chaebol," Kim said, adding that excessive chaebol influence is also hurting South Korean society's economic dynamism.

Hours before being jailed, the Hanwha chairman issued a statement, saying "I feel regretful for not behaving according to proper legal procedures from the beginning of the incident." Professor Kwon said the irregularities by chaebol owners have been resurfacing because of lenient judicial decisions.

"In Korea, let's face it, getting into trouble is hardly new for a chaebol chairman. Admittedly, this one is different from accounting fraud (the S Group), slush funds (H group), bribery and corruption (all groups)," Michael Breen, a Seoul-based consultant and the author of "The Koreans," wrote in a local newspaper column on Friday, apparently referring to SK and Hyundai Motor.

"These white-collar things are not considered crimes as such," Breen said. "They fall into a category of normal business practice crimes, which is why people who are technically criminals go on running the nation's biggest firms."

SEOUL, May 15 (Yonhap News)