A court issued an arrest warrant on Wednesday for the founder of cash-strapped budget carrier Eastar Jet on charges of embezzlement and breach of trust.

Lee Sang-jik, an independent lawmaker, is suspected of colluding with a senior company official who was indicted in February for causing about 43 billion won ($38.47 million) in financial damage to the airline by paying off long-term loans early and underselling company shares to a specific subsidiary.

Judge Kim Seung-gon of the Jeonju District Court issued the warrant sought by prosecutors, saying the suspect may falsify evidence or try to coax others involved in the case to make or not to make a certain statement judging from his behaviors shown in the investigation process.

Lee became the second sitting lawmaker to be put behind bars in the current legislature after Rep. Jeong Jeong-soon of the ruling Democratic Party.

Last week, the National Assembly passed a motion that allowed for his arrest. Sitting lawmakers are immune from arrest while the parliament is in session. The prosecution must obtain parliamentary consent to detain lawmakers.

Lee is accused of conspiring with the arrested official, who is believed to be his nephew, to embezzle 3.8 billion won of affiliates' funds.

He also allegedly operated an office of party members in his constituency in Jeonju prior to the parliamentary elections in April 2020, in violation of the act that bans individuals from running party offices.

Formerly affiliated with the Democratic Party, Lee left the ruling party last September amid controversy over unpaid wages, mass layoffs and corruption allegations surrounding his family.

The prosecution began an investigation into Lee in July after the main opposition People Power Party and the labor union of Eastar Jet filed complaints.

They raided his home and the company several times and questioned Lee in February.

Hit by an industry slump due to the coronavirus pandemic, Eastar has been in a court-led rehabilitation process since early February. (Yonhap)