Rival parties agree to launch parliamentary investigation


Prosecutors are widening their probe into irregularities by Busan Mutual Savings Bank after picking up clues that the financially troubled bank had attempted to lobby many politicians and senior officials of the government, possibly including Cheong Wa Dae, to block financial regulators from ordering its closure.

The prosecution said that it was verfiying circumstances in which the bank hired another lobbyist identified as Park, separately from Yoon Yea-seong, 56, a financial broker and lobbyist currently in detention over the bank scandal, in a bid to make connections with politicians and high-ranking government officials.

Investigators have secured testimony from an employee of the bank that Park had received hundreds of million won from Kim Yang, vice chairman of the bank, in lobby expenses. They are hunting for Park who is believed to be staying abroad. He is known to be close to influential figures of the current regime, and to have fled the country in March shortly before the prosecution opened its probe into the bank.

If the prosecution gets the big-name lobbyist and secures his testimonies regarding his lobby, its probe targeting higher positions will gain speed.

Meanwhile, prosecutors will seek an arrest warrant soon for Eun Jin-soo, a former state auditor who is suspected of taking bribes from the bank in return for influence peddling, officials said.

Eun has been under detention since early Monday morning after a 14-hour-long questioning by investigators from the Supreme Prosecutors’ Office.

The former commissioner of the Board of Audit and Inspection faces accusations that he accepted kickbacks, including diamonds worth 30 million won, and in return pulled strings to help the corruption-ridden bank survive state audits.

The prosecutors said they have obtained testimony from Yoon that he “had given hundreds of million won worth of jewelry and money to Eun.”

They are also looking into whether Eun leaked the BAI’s audit information on the lender and delayed the announcement of the audit results until early this year.

The former BAI official, however, denies any wrongdoings, insisting the money he received was fee for his legal advice. He worked as a legal adviser to the bank for two years since 2005.

The Financial Supervisory Service, in February, suspended the lender, along with other savings banks, for capital shortage. More than 300,000 of its customers had their accounts frozen and some 10,000 of them may lose their deposits that exceed the insured amount of 50 million won.

The prosecution has been probing the bank, the largest savings bank in Korea in asset terms, after it was revealed that executives and major shareholders were found to have taken out illegal loans to lobby politicians and senior government officials and engaged in other irregularities totaling about 7 trillion won.

Eun was among the attorneys representing then leading presidential candidate Lee in 2007 when he was implicated in a stock price-rigging scandal dubbed “the BBK case.” He later joined Lee’s presidential transition team as a legal adviser. Prior to that, in 2004, he served as a spokesperson of now-ruling Grand National Party.

The prosecution said it arrested an FSS official on allegations that he helped the bank cover up irregularities in exchange for bribes amounting to nearly 100 million won.

By Lee Sun-young (milaya@heraldcorp.com)