By Lee Kyung-min
The prosecution sought a detention warrant for former Financial Supervisory Service (FSS) deputy governor Kim Jin-soo, Tuesday, over allegations that he had corrupt ties with Keangnam Enterprises.
The prosecution suspects Kim peddled his influence on creditors of the firm to provide emergency funds to Keangnam through a debt-for-equity swap deal when it was under a creditor-led debt rescheduling program in 2013.
Kim is suspected of having taken kickbacks from the firm's former owner, Sung Woan-jong, in return for his help.
Earlier this month, prosecutors raided Kim’s home and offices and the headquarters of Shinhan Bank, which was the firm’s main creditor.
The investigation is based on allegations raised by the Board of Audit and Inspection that the financial regulator gave preferential treatment to Keangnam.
The emergency fund provided to the firm amounts to some 1 trillion won ($ 91 million), according to the prosecution.