MBK Chairman Kim Byungjoo Banned from Leaving Country over 'Homeplus Incident'

The prosecution investigating the 'Homeplus short-term bond incident' has imposed a travel ban on Kim Byungjoo, chairman of MBK, who has been identified as a key decision-maker in the case. Since Chairman Kim, a U.S. citizen, has been staying abroad, the authorities appear to have taken this measure in advance to prevent any disruption to the ongoing investigation should he leave the country again. Chairman Kim has been accused of fraud under the Act on the Aggravated Punishment of Specific Economic Crimes and of violating the Capital Markets Act in connection with the Homeplus case.

According to legal sources on May 19, the Third Anti-Corruption Investigation Division of the Seoul Central District Prosecutors' Office (headed by Lee Seunghak) recently imposed a travel ban on Chairman Kim, a U.S. citizen, through the Ministry of Justice. The Immigration Control Act allows the Minister of Justice to prohibit the departure of a foreign national if it is deemed inappropriate for the person to leave the country due to a criminal investigation.

Earlier, on May 17, prosecutors executed a search and seizure warrant on Chairman Kim as he was returning from a business trip to London, United Kingdom, arriving at Incheon International Airport from London. It is reported that the prosecution secured Chairman Kim's mobile phone and other items during the search.

The prosecution suspects that the management of Homeplus, a major discount store chain, and MBK Partners issued short-term bonds even after being aware in advance of a downgrade in their credit rating from 'A3' to 'A3-' and planning to file for corporate rehabilitation. The investigation is being conducted on suspicion of fraud. Prosecutors believe that Homeplus and MBK Partners may have issued the bonds despite being notified of the initial credit rating downgrade on February 25, in an attempt to pass potential losses onto investors.

Meanwhile, on April 28, prosecutors conducted searches and seizures at the residences of Chairman Kim, Vice Chairman and Homeplus Co-CEO Kim Kwangil, and Homeplus CEO Cho Jooyeon, as well as at the headquarters of MBK Partners. Once the analysis of the seized materials is complete, prosecutors are expected to summon key executives for questioning as suspects.