Seoul Prosecutors on Monday requested a preliminary arrest warrant for Sung Woan-jong, chairman of Keangnam Enterprises, on suspicion of fraud and the embezzlement of company funds.

Sung is believed to have fabricated the company’s financial status to receive a combined 80 billion won ($73.7 million) in government and private loans, according to Seoul Central District Prosecutors’ Office. Investigators said his company is responsible for several irregularities, including fraudulent accounting for 950 billion won.

The 64-year-old former lawmaker has also been accused of creating a slush fund worth some 20 billion won via associated companies owned by his wife, who was summoned by prosecutors last Wednesday for questioning.

Prosecutors brought in Sung on Friday for an inquiry, during which he claimed he did not know specifics about the finances at his company. Investigators, however, believe that Sung masterminded the entire process.

The court is expected reach a decision on Sung’s warrant Wednesday.

Keangnam Enterprises is just one of the companies currently being investigated in a corruption scandal involving former Lee Myung-bak administration’s multibillion dollar project that sought to develop overseas energy resources.

Moon Jae-in, leader of the main opposition New Politics Alliance for Democracy, urged the former president Monday to join him in attending the hearing for an investigation into the scandal. The ruling Saenuri Party rejected the call.

By Yoon Min-sik (minsikyoon@heraldcorp.com)