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| The photo shows a branch of Hana Bank / Yonhap |
By Kim Bo-eun
A partial business suspension is looming over Hana Bank, as financial authorities determined the lender should become subject to the penalty for mis-selling funds to investors from 2017 to 2019.
The Financial Supervisory Service's (FSS) sanctions review committee decided the bank should become subject to a partial business suspension for three months, in addition to a fine and penalties imposed on executives and employees who were involved. The proposed punitive measure will undergo further reviews until the Financial Services Commission reaches the final conclusion.
The FSS sanctions committee, however, did not review penalties for Hana Financial Group's Vice Chairman Ji Sung-kyoo, who was then-Hana Bank CEO. This is because lawsuits are currently ongoing between other former bank CEOs and the FSS over sanctions that have been imposed holding them accountable for their lenders' respective mis-selling of investment products.
Hana Bank distributed a total of 11 funds amounting to 270 billion won ($223.8 million) to investors, who ended up suffering substantial losses. They stated that the lender was responsible, given investors were not provided sufficient explanation about the product they invested in.
Hana is one of multiple local financial firms including Woori Bank that came under scrutiny for mis-selling funds ― some of which were questionably managed by investment firms.
Earlier, Woori Financial Group Chairman Son Tae-seung became subject to an employment restriction for Woori Bank's mis-selling of funds that occurred while he was the lender's CEO. But Son filed a lawsuit to refute the penalty, and a lower court sided with him. The FSS has appealed that ruling.
Hana Financial Group Vice Chairman Ham Young-joo also received the same penalty, against which he has also taken legal action. A lower court ruling will take place next month.
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