'15 Billion Won Illegal Loan' Kim Ki-yu, Former Taekwang Group Chairman, Arrest Warrant Dismissed (Comprehensive)

"Low Possibility of Evidence Tampering"

Kim Ki-yu, former chairman of the Taekwang Group Management Council (69), who is under prosecution for ordering improper loans worth around 15 billion KRW to affiliates' executives, has avoided detention.

Kim Ki-yu, former Chairman of the Taekwang Group Management Council [Photo by Yonhap News]

Shin Han-mi, the judge in charge of warrants at the Seoul Western District Court, held a pre-arrest detention hearing for Kim on the morning of the 4th at 10:30 a.m. and dismissed the arrest warrant.

Judge Shin explained, "There is a substantial amount of evidence related to the criminal facts, so it is difficult to see a risk of evidence tampering, and it is also difficult to see a risk of flight. At this stage, the necessity and reasonableness of detaining the suspect are not recognized."

Kim is accused of ordering Lee (65), the CEO of a real estate development company and an acquaintance, to execute a loan of approximately 15 billion KRW through Lee (58), then CEO of the group affiliates Goryeo and Yegaram Savings Banks, in August last year.

At that time, Lee had difficulty obtaining additional loans from other financial institutions, and the savings bank's credit review team submitted a review opinion to the credit review committee stating that the business risk was high. However, the loan was pushed through at Kim's request. It was investigated that Lee transferred 10 million KRW to Kim's wife's account about two months after the loan was made, in October last year.

The prosecution received a report from a law firm conducting an external audit of Taekwang Group in November last year and launched an investigation, indicting Lee and the former CEO Lee in July this year.

Kim served as the group's "number two" in management after former Taekwang chairman Lee Ho-jin was detained in 2011. The law firm alleged that Kim, entrusted with management by Lee during his imprisonment, committed various misconducts. Lee was granted a special pardon in August last year, and after his release, the two have been in conflict and engaged in disputes.