Four Hana Bank Executives Sanctioned for Violating the Real Name Financial Transaction Act (Comprehensive)

FSS Accused of Sharing Customer Information with Law Firm

On the 3rd, the monitor in the dealing room of Hana Bank in Jung-gu, Seoul, displayed the brand name "Hana Bank" without "KEB." Hana Bank announced that from this day forward, it will change its brand name from KEB Hana Bank to "Hana Bank" and start anew as the New Hana Bank preparing for the next 10 years. Photo by Kim Hyun-min kimhyun81@

[Asia Economy Reporter Kim Min-young] As the Financial Supervisory Service (FSS) has begun sanctions against Hana Bank for handing over financial transaction information of about 1,000 customers of overseas interest rate-linked derivative-linked funds (DLF) to a law firm, it is reported that four Hana Bank employees have been targeted for sanctions.

According to financial authorities and the financial sector on the 8th, the FSS plans to soon submit the case of Hana Bank’s violation of the Act on Real Name Financial Transactions and Confidentiality (Real Name Financial Transactions Act) to the Sanctions Review Committee.

According to the FSS, Hana Bank handed over information of about 1,000 DLF customers (1,936 accounts) to a law firm with which it had a legal advisory contract in August last year. The FSS, which tentatively concluded this was a violation of the Real Name Financial Transactions Act, reportedly included a total of four employees?three from Hana Bank’s investment products department (now IPS Headquarters) and one from another department?as subjects of sanctions.

Hana Bank explained that the information was provided for legal advice purposes in preparation for customer complaints. A Hana Bank official stated, “We judged that this case falls under the exception in Article 4, Paragraph 1, Subparagraph 5 of the Real Name Financial Transactions Act, which does not require customer consent, and thus provided the information,” adding, “The financial transaction information was used only for legal consultation purposes.” The official also said, “We gave the same explanation to the FSS during the DLF inspection.”

Accordingly, with a comprehensive legal advisory contract in place, a fierce legal dispute is expected to unfold over the FSS sanctions.

Meanwhile, the results of the provisional injunction application to suspend the execution of heavy sanctions (disciplinary warning) imposed by financial authorities on Hana Financial Group Vice Chairman Ham Young-joo (former Hana Bank CEO) and others for causing massive principal losses to customers through DLF will be decided on the 18th at the Seoul Administrative Court. Not only Vice Chairman Ham but also two executives from the asset management (WM) division at the time, as well as Hana Bank?which was fined 16.78 billion KRW and suspended from selling new private equity funds for six months?have filed provisional injunction applications. It is widely expected that the injunction will be granted, similar to the case with Woori Bank.

A financial sector official predicted, “After the provisional injunction is granted, the legitimacy of the sanctions will be contested through administrative litigation, which will take at least two to three years.”

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