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IBK Industrial Bank of Korea (Photo: IBK Industrial Bank of Korea) |
[Alpha Biz= Paul Lee] Prosecutors raided IBK Industrial Bank of Korea on Monday over allegations of illegal loans worth approximately 24 billion KRW.
The Seoul Central District Prosecutor’s Office’s Corruption Investigation Division 1 (led by Chief Prosecutor Lee Joon-dong) conducted raids on IBK’s loan officers in Seoul and Incheon, as well as about 20 related companies. The investigation focuses on suspicions of illegal lending and embezzlement in violation of duties.
In January, IBK disclosed that a financial incident had occurred involving 23.95 billion KRW. The internal audit revealed that during the process of real estate-secured loans, collateral values were inflated, resulting in loans exceeding the limits. It was reported that loan officers at branches in places like Gangdong-gu, Seoul, had authorized loans that did not meet the required criteria for former employees. IBK has placed all relevant employees on leave.
IBK reported the results of its audit to the Financial Supervisory Service (FSS), which conducted an on-site inspection last month and referred the case to prosecutors for further investigation. The FSS’s investigation also uncovered evidence that employees had systematically concealed documents related to the improper loans. FSS Governor Lee Bok-hyun testified before the National Assembly’s Political Affairs Committee on February 18, stating, "This is not just the misconduct of one or two employees, but an inherent and structural problem. We will hold those responsible accountable." He further emphasized that the issue stems from a culture of favoritism and expansionism within the bank, which he considered very serious.
Prosecutors plan to question the individuals involved once they finish analyzing the seized materials and are also investigating whether there was any organizational involvement in the scandal.
Alphabiz Reporter Paul Lee(hoondork1977@alphabiz.co.kr)
