Prosecutors Conduct Search and Seizure at Woori Bank Headquarters and Residences Over 'Son Tae-seung's Relatives' Improper Loans'

The prosecution has launched a forced investigation into allegations that large-scale illegal loans were made to relatives of former Woori Financial Group Chairman Sohn Tae-seung.

The Financial Investigation Division 1 of the Seoul Southern District Prosecutors' Office (Chief Prosecutor Kim Su-hong) is conducting searches and seizures on the morning of the 27th at eight offices, including the Woori Bank headquarters in Jung-gu, Seoul, and the Seolleung Financial Center, as well as four residences of individuals related to the case. However, a representative of the Southern District Prosecutors' Office stated that they "cannot confirm" the identities of the individuals whose residences were searched.

A Woori Bank branch in Seoul. Photo by Jinhyung Kang aymsdream@

Woori Bank, a subsidiary of Woori Financial Group, issued a total of 61.6 billion KRW (42 cases) in improper loans to relatives of former Chairman Sohn, including his brother-in-law's wife and nephew, over approximately four years from April 3, 2020, to January 16 of this year. Among these, 35 billion KRW (28 cases) are suspected to be preferential loans due to missing loan documents or improper evaluation of collateral and guarantees. Former Chairman Sohn served as chairman, including concurrently holding the position of bank president, from January 2019 until early last year, and a significant portion of the loans were executed during his tenure.

This fact was uncovered during an internal audit conducted by Woori Bank earlier this year. Subsequently, the Financial Supervisory Service (FSS) conducted an on-site inspection starting in June and reportedly found evidence implicating former Chairman Sohn. The FSS announced a special inspection related to this case on the 9th and is said to have recently started a re-inspection.

In particular, controversy has arisen over the current Woori Bank management knowing about the improper loans related to the former chairman's relatives but failing to report them to the authorities. Regarding this, FSS Governor Lee Bok-hyun appeared on a radio broadcast on the 25th and stated, "It is clear that this case was not reported to the FSS in a timely manner," adding, "Someone must be held accountable."