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Truth Panel Recommends Prosecution to Probe 10 Shinhan Financial Group Executives for Perjury
Prosecutors Pushed to Look into Shinhan Scandal
Truth Panel Recommends Prosecution to Probe 10 Shinhan Financial Group Executives for Perjury
  • By Yoon Young-sil
  • November 6, 2018, 18:21
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Former Shinhan Financial Group chairman Ra Eung-chan (center), former Shinhan Financial Group president Shin Sang-hoon (right) and former Shinhan Bank president Lee Baek-soon (left).

The truth committee under the Ministry of Justice has recommended the prosecution to investigate 10 former and incumbent executives of Shinhan Financial Group, including former chairman Ra Eung-chan, who are suspected of  having given false testimony in trials on a corruption case that took place in 2008.

The committee said on Nov. 6 that it has confirmed prosecutors’ abuse of their power in investigating the corruption case. In 2010, prosecutors investigated the allegations that the financial group had provided 300 million won (US$266,785) in slush funds to Lee Sang-deuk, the elder brother of the former South Korean President Lee Myung-bak, in 2008.

In investigating the allegations, the Seoul Central District Prosecutors` Office indicted Shin Sang-hoon, a former president of Shinhan Financial Group, on charges of embezzlement and breach of trust.

The truth committee said it has found that the investigation team abused their power in indicting Shin.

The committee said a considerable portion of the slush funds that Shin was alleged to have raised and spent for personal purposes had in fact been used to cover Ra’s legal fees and raise the 300 million won delivered to Lee.

“The investigation team had confirmed these facts, but cleared Ra of suspicion while indicting Shin,” the panel said, announcing the outcome of its review.

The panel also said, “The investigation team was also aware that former and incumbent executives of Shinhan Financial Group had given false testimony against Shin systematically in the process of the trial. But prosecutors failed to take action against them.”

The committee said it has decided to recommend the prosecution to investigate the 10 former and incumbent executives of Shinhan Financial Group because incumbent Shinhan Bank president Wi Sung-ho has already been investigated for perjury following a petition by civic groups. It also noted that the statute of limitations on some of the false testimonies is less than a year away.

"We hope that the prosecution reveal the truth of the corruption case through a swift and thorough investigation and take responsible measures based on it,” it said.

The corruption case surfaced in 2010 in the course of a power struggle between Ra and Shin. The two fought for managerial control of Korea’s largest financial group and took legal actions against each other.

Prosecutors looked into the flow of funds around the persons involved in the feud and secured a statement from a Shinhan Bank official that Lee Baek-soon, a former president of the bank, handed over 300 million won to Lee Sang-deuk in February 2008 under the instruction of Ra.

Civic groups have filed complaints against Ra over the corruption scandal, but the prosecution cleared him of charges.