Former BNK Financial Chairman Seong Se-hwan Acquitted in LCT 30 Billion Won Unfair Loan Case

Seong Se-hwan, Chairman of BS Financial Group

[Asia Economy Reporter Kim Hyung-min] The former chairman of BNK Financial Group, Sung Se-hwan, who was indicted on charges of improperly loaning 30 billion KRW due to a shortage of funds for the LCT project, a super high-rise building in Busan, has been acquitted.

The Supreme Court's 3rd Division (Presiding Justice Lee Heung-gu) announced on the 7th that it upheld the lower court's ruling acquitting former Chairman Sung, who was charged with violating the Act on the Aggravated Punishment of Specific Economic Crimes (breach of trust).

Three executives, including former Busan Bank Vice President Park Jae-kyung, who were indicted together, and five others including Lee Young-bok, the actual owner of LCT, were also acquitted.

Lee and others were indicted on charges of establishing a shell company in December 2015 to borrow 30 billion KRW from Busan Bank, citing a shortage of essential project funds for LCT.

Former Chairman Sung and others were tried on charges of knowingly approving loans through inadequate screening, allowing Lee, who was credit-impaired, to provide guarantees and collateral for the shell company’s indirect loan for LCT.

The first trial court ruled, "Although the additional loan was improperly and hastily processed in violation of regulations, it is difficult to conclude that there was no possibility of recovery or that the loan caused damage, so it does not constitute breach of trust," and acquitted them. The second trial court also upheld the acquittal.

The Supreme Court recognized the lower court’s ruling, stating, "There is no error affecting the judgment, such as a misunderstanding of the legal principles regarding intent for breach of trust in the lower court’s decision."

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