Ongoing Illegality

Seo Jin-won (center), president of Shinhan Bank, poses with bank employees.
Seo Jin-won (center), president of Shinhan Bank, poses with bank employees.

 

It has been claimed that Shinhan Bank President Seo Jin-won illegally looked into the accounts of the acquaintances of former Shinhan Financial Group President Shin Sang-hoon, even after taking office.

The allegation that the illegal activities continued until last year is a new development, apart from the suspicions about such an act immediately after the Shinhan scandal in 2010. Under the circumstances, attention is being paid to how the prosecution and financial authorities will respond. The Shinhan scandal broke out on Sept. 2, 2010, when Shinhan Bank accused then-President Shin Sang-hoon of embezzlement and misappropriation. President Seo took office in December 2010.

“Shinhan Bank illegally viewed account details 134 times between 2010 and 2013,” said Democratic United Party (DUP) lawmaker Lee Sang-jik on Oct. 27, adding, “President Seo tried to cover up the crime, even being aware of the fact, and this organized crime is still going on.”

DUP lawmaker Kim Ki-shik held the Financial Supervisory Service (FSS) accountable. “Shinhan Bank committed the illegal act in order to drive out former President Shin, but only the working-level employees were punished,” he pointed out, continuing, “This deed is a clear violation of the Banking Act and the Financial Holding Company Act, and any person associated with it has to be subject to punishment.” In response, the FSS said that it would launch a thorough investigation.

In the meantime, many are paying attention to whether or not the recent situation will affect the president's consecutive re-appointment in March next year. Shinhan Bank was the only Korean bank that recorded a current net income of more than 1 trillion won (US$953 million) during the first half of this year. In addition, it has outperformed the other banks in both current net income and return-on-asset ratio for four consecutive years since his inauguration.

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