The Financial Supervisory Service on Sunday demanded that Kookmin Bank, one of South Korea’s largest lenders, rectify its internal control system, saying special inspections will be under way over three allegations of irregularities involving Kookmin Bank executives and employees.

The FSS said it will launch two more special investigations this week into allegations of Kookmin Bank’s illegal interest earnings from guaranteed loans and a suspected embezzlement of 9 billion won ($8.48 million) by Kookmin employees in charge of housing bonds.

Kookmin has already been under an investigation since early this month on suspicion that its Tokyo branch was involved in running slush funds for the bank’s management.

It is unprecedented in the nation’s banking industry that a major lender has been under three separate special probes at one time.

Besides the allegations of irregularities, the bank’s management drew fire for a massive investment loss in Kazakhstan and a controversial reshuffle of branch managers in Beijing.

Kookmin purchased a 41.9 percent stake in a Kazakh bank for 940 billion won in 2008, which has since inflicted losses worth 400 billion won on the South Korean lender. (Yonhap News)