Prosecutors raided South Korean retail giant Lotte Group's hotel unit Thursday over allegations it received bribes from the chief of a local cosmetics brand who is at the center of a lobbying scandal that is rocking the country's legal establishment.

The Seoul Central District Prosecutors' Office said it confiscated computer hard discs, accounting books and other related documents from Lotte Hotel Co.'s department in charge of duty-free shops in central Seoul.

The house of Shin Young-ja, the head of Lotte Foundation and daughter of group founder Shin Kyuk-ho, was also raided.

The 74-year-old and other company officials are suspected of receiving kickbacks from Jung Woon-ho, chief of Nature Republic, through a broker in return for space in Lotte's duty-free shops.

Shin and the Hotel Lotte have been flatly denying the allegations.

The legal action followed the formal arrest of a prosecutor-turned-lawyer early Thursday morning, over allegations he peddled influence to cover up Jung's overseas gambling charges.

Last month, the Seoul High Court commuted Jung's original one-year prison term that he received from a lower court to eight months.

The Seoul Central District Court also issued a writ to formally arrest the businessman on the same day. Jung's jail term is scheduled to end Sunday.

Now the businessman is suspected of embezzling some 14 billion won ($11.7 million) of company assets in early 2015. (Yonhap)