[Asia Economy Reporter Kim Hyo-jin] Sohn Tae-seung, Chairman of Woori Financial Group and CEO of Woori Bank, is set to engage in a full-scale dispute with the Financial Supervisory Service (FSS) over disciplinary actions related to the overseas interest rate-linked derivative-linked fund (DLF) scandal.
According to financial authorities on the 22nd, Chairman Sohn will attend the second disciplinary review committee meeting regarding the DLF loss incident, held at 2 p.m. at the FSS office in Yeouido, Seoul.
For Chairman Sohn, this disciplinary review is the "main event." The FSS held the first disciplinary review on the morning of the 16th, but the proceedings, including the defense by Vice Chairman Ham Young-joo of Hana Financial Group, lasted about nine hours, leaving Chairman Sohn insufficient time to present his case.
The FSS is conducting this disciplinary review under a collegiate system. Similar to a court trial, the disciplinary subjects and FSS officials state their positions and provide explanations at the review venue, engaging in mutual rebuttals. An FSS official said, "This disciplinary review for Chairman Sohn could also be quite lengthy," adding, "The principle is to listen as fully as possible to the disciplinary subject's position."
Last month, Chairman Sohn received a preliminary notice from the FSS indicating the possibility of a severe disciplinary action, a written warning. If the written warning is confirmed, he can complete his remaining term as an executive but will be restricted from employment in the financial sector for three years thereafter.
Chairman Sohn was recommended last month as the next chairman candidate for a three-year term. The outcome of the disciplinary review could affect whether he retains the chairman position. Therefore, Chairman Sohn plans to make every effort during the review to reduce the severity of the disciplinary action.
To this end, he is expected to refute the grounds for the disciplinary action presented by the FSS, such as internal control deficiencies and excessive management pressure, and argue the unfairness of bearing almost full responsibility as chairman or CEO.
The disciplinary review for Chairman Sohn and others will be held once more on the 30th. Depending on circumstances, additional disciplinary reviews may be held next month. On the 20th, after completing a "sharing activity" event at Mangwon Market in Mapo-gu, Seoul, FSS Governor Yoon Seok-heon responded to reporters' questions about whether the disciplinary review results would be announced within this month by saying, "It may take more time."
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