The Korea Herald


Ex-Lee attorney embroiled in savings bank scandal

By 이선영

Published : May 26, 2011 - 19:24

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President accepted BAI commissioner's resignation

A confidant of President Lee Myung-bak is suspected of taking bribes from Busan Mutual Savings Bank in return for influence peddling over the financial regulators’ inspection of the lender, reports said Thursday.

The prosecutors, who have been probing irregularities at the bank, have sent a subpoena against Eun Jin-su, a commissioner for the Board of Audit and Inspection, on suspicions that he received bribes from the lender and helped it lobby influential people in the government, officials at the prosecutor’s office said. 

“We understand he will soon present himself for questioning,” they said. 

Eun tendered his resignation and President Lee Myung-bak accepted it, Lee's spokesperson Kim Hee-jung said Thursday evening.

Eun Jin-su Eun Jin-su

A former prosecutor himself, Eun was among the attorneys representing President Lee in 2007 when Lee, then a leading presidential candidate, was embroiled in a stock price-rigging scandal dubbed “the BBK case.” He later joined Lee’s presidential transition team as a legal advisor. Prior to that, in 2004, he served as a spokesperson of then-opposition Grand National Party.

With Eun embroiled, what first started as a financial corruption case is rapidly evolving into an influence-peddling scandal that could implicate some core members of the incumbent or former administrations.

Sensing its possible political fallout, Rep. Kim Jin-pyo, the floor leader of the main opposition Democratic Party, called on the prosecution to conduct an impartial and thorough investigation.

“The prosecution must thoroughly investigate suspicions (surrounding Eun) and leave no stones unturned. We, ourselves, will also do so during a parliamentary probe (into the case) set to open in June,” he said.

Moon Jae-in, a close aide of the late President Roh Moo-hyun, meanwhile, strongly denied a news report earlier in the week that linked the bank to the former leader.

The JoongAng Ilbo, a vernacular daily, reported Wednesday that the troubled lender may have received business favors under the Roh administration, citing what it described as a close relation between the bank’s second largest shareholder Park Hyung-sun and the former president.

“Park may have been a supporter of Roh but he never had a close relation with the late president,” Moon said.

The Busan Mutual Savings Bank has been under probe after it was revealed that some VIP customers and families of its staff members secretly withdrew massive deposits from their accounts just a day before its operations were suspended by financial authorities.

It was officially suspended on Feb. 17 after its property project-linked loans turned sour, significantly denting its capital adequacy.

The illegal withdrawal sparked public anger, as some 300,000 customers had their accounts frozen on the suspension order and may lose their deposits exceeding the insured ceiling of 50 million won.

The investigation has so far found that illegal lending has been rampant at the lender, but financial regulators overlooked or ignored the wrongdoings, allegedly keeping shady relations with the bank.

By Lee Sun-young (