FSS will take close look at Woori Bank’s CJ recordsThe Financial Supervisory Service will launch a special inspection into Woori Bank, main creditor of CJ Group, the country’s 14th-largest conglomerate, suspected of having created overseas slush funds to avoid paying taxes at home.
“We will look into the institution’s internal regulation conditions and see if there were any violations, such as going against the country’s real-name financial transaction act,” said an FSS official. “As for now, we plan to conduct a special inspection into only one financial institution [Woori], but the number of targets can be expanded if we feel it is necessary to check out further into others, using transaction records with CJ.”
The inspection, according to the official, will start next week.
Woori Bank is the main creditor of CJ Group, meaning that most financial transactions within the conglomerate are carried out by Woori Bank. According to industry sources, if the institution allowed the conglomerate to create a borrowed-named bank account, that would violate the real-name financial transaction act.
The special inspection comes as the prosecution requested that the FSS look into the financial institution where several hundreds of borrowed-name accounts suspected to be held by CJ Group have been made, according to sources.
Separately, on Tuesday the prosecution raided the headquarters of Shinhan Bank to look into records of the bank’s business with CJ Group’s Tokyo branch.
Prior to that, the prosecution raided the home of CJ Group Chairman Lee Jay-hyun as part of its investigation into the group’s alleged overseas slush funds.
Earlier yesterday, FSS governor, Choi Soo-hyun, told reporters that if needed, the regulator will look into the issue of CJ Group in general.
“If necessary, we will have to secure data [related to CJ Group’s alleged creation of slush funds],” Choi said.
“That is the duty of the FSS.”
Woori Bank so far hasn’t received an official notification from the FSS about the special inspection.
By Lee Eun-joo [firstname.lastname@example.org]