South Korea reacted with shock yesterday to the suicide of Chung Mong-hun, the Hyundai Group chairman accused of secretly funnelling cash to communist North Korea.

The death of Mr Chung threw the Hyundai business empire into turmoil and knocked shares in its listed companies sharply lower. It also deepened the controversy surrounding allegations that Seoul had bribed Pyongyang to take part in the historic Korean summit three years ago.

Mr Chung, son of Hyundai founder Chung Ju-yung, jumped to his death early yesterday from the 12th floor of the conglomerate's headquarters in the South Korean capital. He was awaiting trial on charges of involvement in $500 million (€444 million) of secret payments to North Korea - including $100 million of government funds - shortly before the June 2000 summit in Pyongyang.

In June, prosecutors accused the South Korean government of using Hyundai as a conduit for payments to "buy" the North Korea's agreement to the summit, for which Kim Dae-jung, the former president, won the Nobel Peace prize.

In suicide notes, Mr Chung said: "Sorry for being a stupid man and for doing a stupid act."

Police found Mr Chung's office window open and said there were no suspicious circumstances surrounding the death.

Mr Goh Kun, South Korea's prime minister, said Mr Chung's death was "shocking and regrettable", while President Mr Roh Moo-hyun paid tribute to his role in improving relations between the two Koreas.

Hyundai was South Korea's biggest business group until it split following the country's 1997 financial crisis. Mr Chung's brothers took control of the group's flagship carmaking and shipbuilding businesses, while he was left with a rump of troubled companies. - (Financial Times Service)