OK Savings Bank Fined 370 Million Won for Breaking Lending Business Exit Pledge

OK Savings Bank has received a heavy disciplinary action for violating its pledge to withdraw from the lending business and continuing to operate a lending business through its affiliates.

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According to the financial sector on August 9, the Financial Supervisory Service has issued an institutional warning and imposed a fine of 372 million won on OK Savings Bank for operating a lending business through its affiliate, despite having pledged to withdraw from the sector when it received approval for the business transfer of Rush & Cash (Apro Financial Lending), an affiliate.

Types of sanctions for financial companies include registration or license cancellation, business suspension, corrective orders, institutional warnings, and institutional cautions. From an institutional warning, the sanctions are classified as heavy disciplinary actions.

In June 2023, OK Savings Bank received approval for the business transfer to absorb and merge the assets and liabilities held by Rush & Cash, on the condition that OK Financial Group completely withdraw from the lending business.

However, an inspection revealed that two affiliates within OK Financial Group continued to operate lending businesses until last year, thereby violating the conditions of approval.

OK Financial Group has since withdrawn from the lending business. At the beginning of this year, all related affiliates were closed down.

Additionally, during the subsequent major shareholder eligibility review, OK Savings Bank omitted certain information about lending companies within its affiliates and submitted false documents. The company also failed to disclose information about these companies in its management disclosures.

The sanctions also included charges of embezzling customer funds.

Employee A of OK Savings Bank embezzled 169 million won by arbitrarily canceling the time deposits of six long-uncontacted customers whose deposits had matured between March and October 2021.

During this process, Employee A was also found to have opened deposit and withdrawal accounts in the names of these customers using copies of identification certificates submitted by other customers, and used these accounts for the inflow and outflow of the embezzled funds.

Employee B, who worked at another branch, managed the bankbooks, seals, and passwords of five acquaintances between 2014 and 2018, and used them to embezzle 253 million won.

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