Former Lime Vice President Jongpil Lee's Corruption Scandal Deepens... Additional Charges of Breach of Trust Added

Financial Supervisory Service reports to prosecutors on embezzlement of over 10 billion KRW in capital gains...

[Image source=Yonhap News]

[Asia Economy Reporter Park Jihwan] Financial authorities have detected signs that Lee Jongpil, former Vice President and Chief Investment Officer (CIO) of Lime Asset Management, embezzled funds worth over 10 billion KRW by purchasing high-quality assets held by Lime funds at low prices through a personal private equity fund. The corruption of Lee, who is cited as the main culprit in the 'Lime scandal' involving approximately 1.6 trillion KRW, appears to be expanding.

According to the securities industry and financial authorities on the 31st, the Financial Supervisory Service (FSS) has found that Lee, former head of Lime Asset Management, entrusted a personal private equity fund to another fund management company and illegally earned arbitrage profits through this method. When the value of assets invested by Lime increased significantly, he gained arbitrage profits by purchasing those assets at a low price.

For example, if the value of a specific company's shares bought for 10 billion KRW increased to 30 billion KRW, Lee would acquire them through his personal fund at 20 billion KRW instead of the market price of 30 billion KRW. It is known that Lee, while working as CIO, made direct investment decisions and orchestrated illegal fund sales and purchases.

An FSS official stated, "It is understood that Lee collaborated with two to three so-called insiders to earn arbitrage profits worth around 10 billion KRW," adding, "The investigation results show that the amount is not at the several hundred billion KRW level as some have suggested." The official also said, "We plan to compile related materials soon and hand Lee over to the prosecution on charges of breach of trust."

Accordingly, Lee is expected to face additional charges of illegal breach of trust using personal private equity funds, in addition to the 80 billion KRW embezzlement case at Lead, a KOSDAQ-listed display manufacturer, and the multi-level financial fraud (Ponzi scheme) and yield manipulation related to Lime's trade finance fund.

As Lee's personal corruption allegations are being revealed one after another, the Lime scandal is increasingly being viewed not merely as a case of incomplete sales but as a comprehensive financial fraud involving fraud, embezzlement, and breach of trust. Previously, Lime fund investors claimed, "We were completely unaware that it was a private equity fund," and "We were never informed about the possibility of principal loss," which had significantly raised issues of incomplete sales against the distributors.

A financial authority official said, "As the investigation into the Lime scandal continues, the issue of incomplete sales, which was prominently highlighted like in the overseas interest rate-linked derivative-linked fund (DLF) incident, seems to be gradually weakening."

This content was produced with the assistance of AI translation services.