Kangwon Land Inc, operator of the only casino in South Korea at which locals are permitted to gamble, has confirmed the appointment of Choi Cheol-Gyu as Vice President and interim CEO following the resignation last week of Lee Sam-Geol.
In a filing, the company said Choi – until recently the Secretary for National Integration for the Presidential Secretariat – would perform CEO duties until a new CEO is appointed, with his role effective as of Tuesday 5 December 2023.
Lee, a former Governor of North Gyeongsang Province, was appointed to a three-year term as Kangwon Land CEO in March 2021 but announced his resignation last week amid a series of recent scandals.
These included the government’s financial watchdog fining the casino KRW3.23 billion (US$2.38 million) over 182 money laundering breaches – all but one involving due diligence failures and some also relating to data manipulation or destruction.
The fine was reduced in view of cooperation of Kangwon Land management, but the state-owned company also performed poorly in its its annual review, receiving a “D” rating thanks in part to accusations of sexual harassment, workplace bullying, graft and wasteful spending.
The company has even fallen short of revenue expectations, including a decline in both revenue and profit in the September 2023 quarter.
In a recent note, investment bank JP Morgan observed the slower than expected recovery of Kangwon Land post-COVID, with demand having flat-lined for three consecutive quarters and little signs of a turnaround even a year after reopening.
Analysts DS Kim and Shi Mufan Shi attributed this slowdown to the proliferation of illegal and grey-market gambling such as cash play at “Hold’em” pubs as well as online casinos.
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