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Prosecution to summon 30 FSS officials this week

Prosecutors plan to call in around 30 employees of the country's financial watchdog this week to determine whether they intentionally relaxed their inspections of savings banks in return for bribes, sources said Sunday.

   South Korea's top prosecutor has been widening its probe after the chief and other major shareholders at a suspended savings bank were found to have taken out illegal loans to lobby politicians and officials and engaged in other financial irregularities involving around 7 trillion won (US$6.4 billion).

   According to the sources, the central investigative unit of the Supreme Prosecutors' Office (SPO) is set to summon 30 employees at the Financial Supervisory Service (FSS) on allegations they were illegally engaged with top executives of Busan Savings Bank and its four affiliates.

   The officials, who worked for the FSS's savings bank bureau, are known to have conducted around 20 inspections on the regional savings bank and its affiliates between 2009-2010.

   The SPO is also mulling calling in high-ranking officials at the financial watchdog to determine their involvement once the investigations on working-level staff are completed, the sources said.

   The move comes after President Lee Myung-bak last week made an unannounced visit to the country's top financial regulator and berated the agency for failing to exercise proper oversight over the suspended savings banks.

   A total of eight savings banks, including Busan Savings Bank, were suspended of operations this year for their insufficient capital bases stemming from soured project financing loans.

(Yonhap News)

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