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Kim Byung-joo, Chairman of MBK Partners. (Photo = Yonhap News) |
[Alpha Biz= Paul Lee] The Financial Supervisory Service (FSS) is expected to convene a disciplinary review committee on December 18 regarding private equity firm MBK Partners in connection with the “Homeplus case.”
According to industry sources, the FSS issued a pre-notification of heavy sanctions—including a potential suspension of duties—to MBK last month. If the disciplinary measures are finalized through the committee and approved by the Financial Services Commission, MBK could face restrictions on new business activities.
Under the Capital Markets Act, sanctions for private equity fund general partners (GPs) range from institutional caution → institutional warning → suspension of duties (up to 6 months) → dismissal recommendation.
A heavy sanction against a GP of an institution-only PEF would be the first of its kind.
If MBK receives a suspension of duties, the firm would be barred from launching new funds for up to six months.
The FSS had initially planned to delay disciplinary action until prosecutors finished investigating allegations of fraudulent bond issuance. However, after FSS Governor Lee Chan-jin took office, the agency revisited the Homeplus case and identified additional violations, leading to the current heavy-sanction proposal.
The FSS reportedly detected unsound business practices and internal control failures during its inspection. Regulators have also been examining whether changes in RCPS (redeemable convertible preferred shares) terms—following a downgrade of Homeplus’s credit rating—may have disadvantaged key investors such as the National Pension Service (NPS), which invested 582.6 billion won.
If heavy sanctions against MBK are finalized, the National Pension Service may terminate its mandate with the firm. Such a move could prompt other pension funds and institutional investors to impose similar restrictions, potentially amplifying the fallout across the market.
Alphabiz Reporter Paul Lee(hoondork1977@alphabiz.co.kr)
