A local court on Wednesday found a former executive director of Asia's largest film festival guilty of embezzlement amid a feud with Busan city.

The Busan District Court sentenced Lee Yong-kwan, who headed the Busan International Film Festival from 2010 to earlier this year, to six months in prison, suspended for two years, on charges of embezzling 25.7 million won ($24,300) in November 2014.

Prosecutors indicted Lee in May, saying he gave a local company the money disguised as brokerage commission when the firm asked the festival to cover up losses it suffered after engaging in a joint business with BIFF. Prosecutors said Lee did not pocket any of the money personally.

The indictment came amid a deepening feud between BIFF management and the municipal government, which demanded Lee's resignation, citing "problems" found in the city's audit.

At that time, Lee had one year left before his second three-year term expired. Busan foots around half of the festival's annual budget.

The move prompted protests from the local film industry who viewed the city's demand to be a retaliatory measure against the film festival's screening of a controversial film critical of the central government despite requests not to do so.

Lee said he will consult with his lawyer and appeal the ruling. (Yonhap)