By Lee Hyo-sik
A group of investigators raided the offices of the so-called ``Shinhan Big 3’’ to confiscate computer files and other documents, expanding a probe into allegations that the three former and incumbent executives of Shinhan Financial Group embezzled company money, breached trust and committed other irregularities.
The Central District Prosecutors’ Office said investigators searched the offices of former Shinhan Financial Chairman Ra Eung-chan, who resigned from his post Saturday, Shinhan Financial CEO Shin Sang-hoon and Shinhan Bank CEO Lee Baek-soon at the bank’s headquarters in central Seoul.
The search and seizure came two months after Shinhan Bank filed a complaint against Shin, alleging that he illegally extended 95 billion won ($82 million) in loans to companies connected to one of his relatives while serving as its president between 2003 and 2009.
A prosecution official said investigators will complete a review of the confiscated materials by Friday and plan to summon Ra, Shin and Lee for questioning as early as this weekend or early next week.
The bank also accused Shin of embezzling 1.5 billion won in advisory fees, which should have been paid to group honorary chairman Lee Hee-kun.
It also filed a complaint against five former and current bank executives, and Tomorrow Group Chairman Kook Il-ho, who has been jailed for embezzlement and former Geumgangsan Land Chairman Hong Choong-il for their alleged roles in the 95-billion-won improper lending.
Following the legal action, Ra and Lee tried to dismiss Shin at a board meeting on Sept. 14, but the financial company’s 12-member board voted 10-1 in favor of his suspension in Nagoya, Japan, where four of the group’s outside directors reside.
The prosecution is also looking into allegations raised by Shin against former Chairman Ra who was replaced by acting Chairman Ryoo Shee-yul last Monday.
Shin has accused Ra and Lee of embezzling large portions of advisory fees, as much as 500 million won, paid to the group honorary chairman.
Investigators suspect that Lee allegedly raised a slush fund by pocketing consulting fees and gave the money to politicians. He has also been suspected of receiving 500 million won from Korean-Japanese shareholders in return for allocating 70,000 forfeited shares to them.
Ra was also sued by a group of civic organizations for masterminding irregular financial transactions. He is suspected of breaching the real-name account regulations last year by transferring 5 billion won to Park Yeon-cha, a Busan-based businessman and supporter of the late former President Roh Moo-hyun, through several bank accounts opened under borrowed names in 2007.
But following Roh’s suicide in May 2009, prosecutors ended an investigation into the late President and his associates including Ra.