Shin Sang-hoon
Shinhan Financial Group CEO |
By Kim Jae-kyoung
Shinhan Financial Group CEO Shin Sang-hoon has been accused of embezzlement, and will soon be dismissed at a board meeting, Shinhan Bank, the flagship of the financial group, said Wednesday.
In a news release, the lender said it found that the CEO and six senior bank managers committed breaches of duty and embezzlement, while Shin was at the helm of the bank.
“We have investigated the case after receiving complaints regarding the lending extended to CEO Shin’s relatives and found that he breached his duty in handling 95 billion won worth of loans,” a Shinhan Bank official said.
“Also, he was discovered to have embezzled 1.5 billion won, which was uncovered while verifying rumors circulating in the bank,” he added.
The group said that since Shin is unable to fulfill his duty due to the accusations, the financial group will soon hold a board meeting to remove him from the CEO post.
“Since there are a couple of outside directors residing in Japan, it will take several days to hold a board meeting. Since most accusations have already been confirmed by our investigation, it is highly probable that the board will decide to dismiss Shin,” a Shinhan Group representative said.
“Managers appointed by incumbent bank CEO Lee Baek-soon found malpractice conducted by their predecessors named by Shin. I guess that Lee and his aides took a stern action to avoid being held accountable for any wrongdoing committed under the former bank CEO,” he added.
Shin, however, has flatly denied the allegations, saying they were groundless.
“The borrowers are not my relatives. The bank claimed that I exerted influence over the lending but you should check how powerful the influence was,” he told Yonhap News Agency.
“The company that took out the loan is now under a debt rescheduling program, but the lending, I believe, did not incur any losses to the bank,” he said.
In the meantime, the bank said that it forwarded the matter to the prosecution as part of efforts to eradicate internal corruption.
“Management should have stricter ethical standards but it has disappointed shareholders and customers. We deeply apologize for the misconduct,” the representative said. “We will use this as an opportunity to reflect onourselves.”
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