Hana Bank, Postponement of Administrative Lawsuit Ruling Demanding Cancellation of Severe Sanctions in 'DLF Incident'

Sentencing originally scheduled for the 16th but trial resumed

[Asia Economy Reporter Minwoo Lee] The first trial verdict for the administrative lawsuit filed by Han Young-joo, the sole candidate for chairman of Hana Financial Group, and Hana Bank, seeking to cancel the heavy sanctions imposed by financial authorities related to the incomplete sales scandal of overseas interest rate-linked derivative-linked funds (DLF), has been postponed.

According to financial circles and the court on the 16th, the Seoul Administrative Court Administrative Division 5 (Presiding Judge Jeong Sang-gyu) decided to resume the first trial hearing for the lawsuit filed by Hana Bank and Han Young-joo, Vice Chairman of Hana Financial Group, against the Financial Services Commission and the Financial Supervisory Service Governor, seeking cancellation of business suspension and other sanctions. The verdict hearing originally scheduled for that day was postponed, and the next hearing date was set for 3 p.m. on the 28th. It is reported that neither Hana Bank nor the Financial Supervisory Service requested the resumption of the hearing separately.

Although the trial result has been delayed more than expected, it is uncertain whether it will affect the chairman appointment process. The board of directors of Hana Financial Group recommended Han Young-joo, Vice Chairman of Hana Financial Group, as the sole candidate for the next chairman on the 7th. The biggest challenge in appointing the chairman was considered to be the 'judicial risk,' but there is a precedent where Sohn Tae-seung, chairman of Woori Financial Group, won a lawsuit on the same grounds.

Earlier, in March 2020, the Financial Services Commission decided to partially suspend some business activities related to new sales of private funds for six months at Hana Bank, the bank that sold DLFs, and imposed a fine of 16.78 billion KRW. The Financial Supervisory Service also imposed a heavy disciplinary action (official warning) equivalent to a three-year restriction on reappointment and employment in financial companies on Vice Chairman Han, who was then the president of Hana Bank. Hana Bank and Vice Chairman Han filed a lawsuit in June of the same year to cancel the heavy disciplinary action, and their request for suspension of the sanction's effect was accepted.

Meanwhile, the first trial verdict hearing for Vice Chairman Han's recruitment-related trial is also scheduled for the 25th. Han is accused of obstruction of business and violation of the Equal Employment Opportunity Act related to the recruitment of an acquaintance's child when he was president of Hana Bank in 2015. The prosecution requested a sentence of three years in prison and a fine of 5 million KRW at the first trial's closing arguments. Since Cho Yong-byeong, chairman of Shinhan Financial Group, was acquitted in a similar recruitment fraud trial, it is expected that there will be little obstacle to Vice Chairman Han's rise to the next chairman.

Previously, Chairman Cho was sentenced to six months in prison with a two-year probation in the first trial in January 2020 but succeeded in his reappointment in March of the same year. In November last year, he was acquitted in the second trial. The prosecution, dissatisfied with this result, filed an appeal with the Seoul High Court Criminal Division 6-3 (Presiding Judges Jo Eun-rae, Kim Yong-ha, Jeong Chong-ryeong), which handled the appeal trial, and the Supreme Court will make the final judgment.

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