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IBK Industrial Bank of Korea |
[Alpha Biz= Paul Lee] Financial authorities have confirmed an improper loan scandal worth 882 billion won at IBK Industrial Bank of Korea. A retired employee colluded with current staff to secure hundreds of billions of won in improper loans, using the funds for real estate profits, while the bank attempted to conceal the issue.
Additionally, Bithumb, the second-largest cryptocurrency exchange in the industry, was found to have provided expensive housing worth 11.6 billion won to former and current executives. A former executive used the housing rent money to pay off the balance on his personally purchased property.
The Financial Supervisory Service (FSS) announced on Tuesday that it had identified improper loans and a cover-up attempt by IBK Industrial Bank. Out of the 882 billion won in improper loans, 785 billion won was linked to a retired employee, identified as A.
A had worked at IBK for 14 years before retiring and starting a real estate business under his name and the names of his family and employees. From 2017 to 2022, A used falsified documents to secure 51 cases of improper loans worth 785 billion won.
A's spouse, who was a loan examiner at the bank at the time, falsified funding plans and colluded with branch managers and loan officers to approve the improper loans. A also built relationships with bank staff through golf meetings and recommended the bank's branch locations for his real estate projects. In exchange for these illegal transactions, A received 12 billion won in bribes.
The investigation revealed that the improper loans were concealed by some departments within the bank, and that documents and records were deleted to obstruct the inspection. Currently, 535 billion won in improper loans remain, with 95 billion won considered non-performing.
As for Bithumb, both current and former executives were found to have unlawfully received expensive housing from the company for personal use. The Financial Supervisory Service criticized Bithumb for failing to establish internal control measures and conflict-of-interest prevention strategies, which led to these improper transactions.
Last June, a current executive at Bithumb received a luxury residence worth about 3 billion won without any clear criteria, using it for personal benefit. Furthermore, in December 2023, a former executive manipulated a lease deal with Bithumb for a personally purchased property, receiving a deposit of 1.1 billion won, which he later transferred to a third party and pocketed 2.8 billion won in rent deposits.
Alphabiz Reporter Paul Lee(hoondork1977@alphabiz.co.kr)
