Rhyme's 'Trade Finance Fund' Due Diligence Completed...Concerns Over Total Loss

[Asia Economy Reporter Park Jihwan] The accounting audit for Pluto TF No. 1 (Trade Finance Fund), one of the Lime Asset Management's private equity funds worth about 1.6 trillion KRW that suspended redemptions, will be completed on the 3rd. The industry believes that the Trade Finance Fund is likely to incur a total loss due to its involvement in a Ponzi scheme by a U.S. hedge fund.

According to the financial investment industry, Samil Accounting Corporation, which is conducting the audit of the Trade Finance Fund, will deliver the final report to Lime Asset Management within the day. Samil Accounting Corporation initially planned to complete the audit by the end of March, but it was delayed due to COVID-19 and the fact that the assets are overseas. A Lime Asset Management official stated, "There will be no public disclosure of the report received from Samil, and it will only be notified to the distributors."

The report is expected to be in the form of an interim audit report. It has been confirmed that there was no verification work to predict the investment recovery rate, which estimates the amount investors will get back during the audit process. The audit only verified whether the assets and contracts invested by the fund actually exist. After receiving the report on the day, Lime plans to adjust the valuation prices by asset and inform the distributors of the expected profit and loss based on it.

Currently, the Trade Finance Fund has already confirmed losses of about half, and additional losses are also feared. Lime Asset Management invested in five overseas Trade Finance Funds worth 500 million USD (approximately 606.5 billion KRW). Among them, the International Investment Group (IIG) fund has entered the liquidation stage after being sanctioned by U.S. financial authorities in November last year, including deregistration and freezing of fund assets, for allegedly selling fake loan receivables, resulting in a principal reduction of 100 million USD. If the principal loss exceeds 200 million USD, investors will lose their entire investment.

Meanwhile, the Financial Supervisory Service will begin an on-site investigation into the Lime incident starting from the 9th. The FSS plans to first initiate dispute resolution procedures for the Trade Finance Fund, which has been accused of fraud such as concealment of insolvency and manipulation of yield.

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