Prosecutors Seek Arrest Warrants for Former and Current Ssangbangwool Executives Over 20 Billion Won Convertible Bond False Disclosure

[Asia Economy Reporter Kim Hyung-min] The prosecution investigating various corruption allegations against Ssangbangwool Group has requested arrest warrants for current and former financial officers of the group on charges including violations of the Capital Markets Act.

According to the legal community on the 20th, the Criminal Division 6 of Suwon District Prosecutors' Office (Chief Prosecutor Kim Young-nam) filed pre-arrest warrants against former Ssangbangwool Chief Financial Officer (CFO) Mr. A and current finance manager Mr. B on charges of violating the Capital Markets Act (fraudulent and unfair trading).

Mr. A and others are accused of falsely disclosing information related to convertible bond (CB) transactions amounting to 10 billion KRW each, conducted twice in 2018 and 2019 under the direction of former Ssangbangwool Chairman Kim Sung-tae. The convertible bonds issued by Ssangbangwool in 2018 were all purchased by an investment company called Chakan-i Invest, reportedly owned by former Chairman Kim. The 2019 convertible bonds were also entirely bought by investment companies registered under the names of former Chairman Kim's relatives or close associates, and were later repurchased in full by Vivian, a Ssangbangwool affiliate. The prosecution suspects that Ssangbangwool secured insufficient company funds through these transactions and engaged in slush fund creation and unfair dealings among affiliates.

Mr. A is also charged with embezzlement of 3 billion KRW and falsification of financial statements, while Mr. B faces charges including breach of trust involving 450 billion KRW.

The pre-arrest detention hearings for Mr. A and others will be held at 10:30 a.m. today at Suwon District Court. The decision on detention is expected to be made later in the afternoon.

The prosecution had previously received data related to Ssangbangwool's "suspicious fund flows" from the Financial Intelligence Unit (FIU) and has been investigating charges including violations of the Capital Markets Act, breach of trust, and embezzlement for over a year. The prosecution's investigation into Ssangbangwool attracted public attention due to suspicions that Ssangbangwool covered legal fees for Lee Jae-myung, leader of the Democratic Party of Korea, in his 2018 election law violation case.

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