A Seoul court has ruled that the country’s financial regulator should make public its reports that helped Lone Star retain its status as the largest shareholder in a South Korean bank, court officials said Friday.

The Seoul Administrative Court made the ruling in a lawsuit filed by a group of employees of the Korea Exchange Bank, the fifth-largest lender in South Korea, against the Financial Supervisory Service, they said.

Since 2003, the Texas-based private buyout fund has been the biggest share holder of the bank, controlling 51 percent stakes.

The union filed the suit after the FSS rejected its demand to reveal all of its eligibility reports on Lone Star citing concerns of possible leak of confidential information contained in the reports and other reasons.

“Making the relevant report public does not get in the way of fairness in future work carried out by the FSS as the information is contained in eligibility reports that are already completed,” Judge Jo Il-yeong said in a ruling.

“Considering that the evaluation on Lone Star’s eligibility has long been under a spotlight, making the report public will in fact fulfill the people’s right to know,” the judge said.

If the ruling is upheld by higher courts, the FSS must reveal all relevant data, including accounting books, results on eligibility reports and documents submitted to the FSC.

The Lone Star scandal has been controversial for almost a decade since the equity firm became the major shareholder of KEB, for allegedly manipulating its stock price.

The top court last year found Lone Star Korea’s chief guilty of manipulating the stock price of a former credit card firm, in a ruling that overturned a lower court ruling that acquitted its head in the controversial 2003 deal.

Based on the reports from FSS, the Financial Services Commission in March of last year concluded that the U.S. private equity company is a financial-oriented investor that could legally hold more than a 9 percent stake in a local financial company. Under the country’s banking laws, a non-financial player is barred from owning a local bank.

The union filed the suit after the FSS rejected its demand to reveal all of its eligibility reports on Lone Star citing concerns of possible leak of confidential information contained in the reports and other reasons.

“Making the relevant report public does not get in the way of fairness in future work carried out by the FSS as the information is contained in eligibility reports that are already completed,” Judge Jo Il-yeong said in a ruling.

“Considering that the evaluation on Lone Star’s eligibility has long been under a spotlight, making the report public will in fact fulfill the people’s right to know,” the judge said.

If the ruling is upheld by higher courts, the FSS must reveal all relevant data, including accounting books, results on eligibility reports and documents submitted to the FSC.

The Lone Star scandal has been controversial for almost a decade since the equity firm became the major shareholder of KEB, for allegedly manipulating its stock price.

The top court last year found Lone Star Korea’s chief guilty of manipulating the stock price of a former credit card firm, in a ruling that overturned a lower court ruling that acquitted its head in the controversial 2003 deal. (Yonhap News)