Food and entertainment conglomerate CJ Group is suspected of holding hundreds of borrowed-name accounts at local financial institutions to use them as a conduit for managing a massive slush fund, prosecutors said Thursday.

The Seoul Central District Prosecutors' Office said it has requested the country's financial watchdog launch a special audit into the financial institutions, including leading lenders Woori Bank and Shinhan Bank.

"We have requested the Financial Supervisory Service open a special audit into whether the institutions allowed CJ Group to open and manage the borrowed-name accounts," the office said.

Under a law enacted in 1993, it is illegal to use borrowed names for financial transactions. However, many conglomerates have been accused of opening bank accounts under the names of others to unlawfully move corporate funds and stash secret funds.

The prosecution probe into the family-run conglomerate has been gaining momentum after prosecutors raided the residence of Lee on Wednesday to secure related documents.

The raid was deemed highly unusual as local courts rarely issue a search warrant for the residence of a conglomerate head, raising speculation that prosecutors have secured enough evidence to substantiate the allegations surrounding the CJ chairman.

Lee, who has been banned from leaving the country, is suspected of ordering and being briefed about the group's alleged wrongdoing that dates back to 2008.

The prosecution office is focusing on determining whether the family-run conglomerate has illicit assets in addition to those revealed five years ago.

In 2008, police found that Lee had secretly managed large funds under borrowed-name bank accounts, and he was ordered to pay 170 billion won (US$151 million) in taxes. (Yonhap news)