Supreme Court: Disciplinary Action Against Sangsanin CEO Yoo Jun-won for "Illegal Loans" Is Justified
Financial Services Commission Imposes 1.5 Billion KRW Fine and 3-Month Suspension of CEO Yujunwon for Illegal Loans at Sangsangin Savings Bank
Sangsangin Group and CEO Yoo Jun-won, who were disciplined by financial authorities for exceeding the credit extension limit in loans, filed a lawsuit challenging the disciplinary action but ultimately lost at the Supreme Court.
According to the legal community on the 22nd, the Supreme Court's 2nd Division (Presiding Justice Lee Dong-won) upheld the lower court's ruling dismissing the lawsuit filed by Sangsangin, Sangsangin Plus Savings Bank, and CEO Yoo against the Financial Services Commission seeking cancellation of the disciplinary measures related to illegal and unfair actions by retirees, by summary dismissal on the 18th of this month.
Earlier, in December 2019, the Financial Services Commission imposed a fine of 1.521 billion KRW on Sangsangin Savings Bank for illegally lending 38.17 billion KRW from January 2015 to February 2019, exceeding the credit extension limit to individual borrowers.
CEO Yoo, who served as the representative of Sangsangin Savings Bank from 2012 to 2016, received a disciplinary notice for illegal and unfair actions by retirees, including a suspension of duties for about three months. The Financial Services Commission cited five reasons, including false reporting despite failing to maintain the mandatory credit extension ratio and formally conducting public auctions to allow major shareholders to acquire convertible bonds at a low price.
Sangsangin contested these disciplinary measures by filing a lawsuit, but the first trial found all five reasons to be valid.
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The second trial ruled that the disciplinary reason that CEO Yoo violated the prior approval obligation under the Act on the Structural Improvement of the Financial Industry was not valid, but maintained that there was no problem in upholding the disciplinary action. The Supreme Court also accepted this appellate court judgment and finalized the ruling.
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