Prosecutors questioned MBK Partners Chairman Michael Byung-ju Kim as a suspect Thursday over allegations that executives had advance knowledge of a possible Homeplus credit rating downgrade while Homeplus-linked short-term financing continued ahead of the retailer’s filing for court-led rehabilitation.
The Seoul Central District Prosecutors’ Office’s Anti-Corruption Investigation Division 2 summoned Kim on suspicion of aggravated economic fraud and violations of the Capital Markets Act, according to legal sources.
Investigators are examining whether Kim and other executives anticipated the downgrade and Homeplus’ subsequent rehabilitation filing but failed to disclose information that could have affected investors’ decisions.
MBK Partners and Homeplus deny having advance knowledge of the downgrade or participating in the issuance or sale of the asset-backed short-term bonds.
The ABSTBs were issued by special-purpose companies established by Shinyoung Securities, using Homeplus-related card-payment receivables as underlying assets. Shinyoung arranged the issuances, while it and other securities firms handled distribution. Any commercial paper issued directly was issued by Homeplus.
Prosecutors raided the headquarters of Homeplus and MBK in April last year, as well as the residences of Kim, MBK Vice Chair Kim Kwang-il and Homeplus CEO Cho Joo-yon.
Kim and Vice Chair Kim were questioned as suspects in December. In January, prosecutors sought arrest warrants for the two and two other MBK executives, but the court rejected all four requests.
The case was reassigned from Anti-Corruption Investigation Division 3 to Division 2 in February for further investigation. Prosecutors questioned MBK Vice President Kim Jung-hwan and Vice Chair Kim in July.
Investigators are expected to decide whether to bring charges after reviewing Kim’s latest testimony and other evidence.
silverstar@heraldcorp.com
