Friend’s daughter got unusual loan

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Friend’s daughter got unusual loan

The friend at the center of the scandal endangering Park Geun-hye’s presidency may have played fast and loose with loans and meddled in a company’s acquisition.

The financial watchdog is investigating whether Chung Yoo-ra, the daughter of presidential confidante Choi Soon-sil, took foreign currency loans illegally or with unlawful favors.

Chung, a college student in her early 20s, received a loan of 250,000 euros ($274,650) with a letter of credit from KEB Hana Bank, a lending process often used by trading companies, before she and her mother moved to Europe.

The Financial Supervisory Service is also looking into whether Chung properly reported the loan to authorities.

“Prosecutors are now investigating if she violated the foreign exchange transaction act,” said a source at the FSS.

Under the foreign currency laws, foreign currency loans over $20,000 must be reported to the Bank of Korea.

The FSS source said, “It is not a common transaction [for an individual] but we still couldn’t find any illegality.”

Rep. Jung Jae-ho of the opposition Minjoo Party of Korea raised the suspicion that the daughter may have gotten preferential treatment in foreign dealings thanks to her mother’s ties to the president. Chung is already a target of criticism because she was accused of receiving special favor in admission and academic credits at Ewha Womans University, which led to the resignation of the university’s president two weeks ago.

Banks issue letters of credit to importers and exporters regularly. The Apgujeong branch of KEB Hana Bank in Gangnam, southern Seoul, released a letter of credit to Chung so that the bank’s German branch would lend her 250,000 euros.

KEB Hana Bank said the transaction was not unusual.

“We can’t discuss in detail because it is related to private information of our client,” a source at the bank said. “But there are some cases that immigrants use letters of credit to get access to guaranteed loans.”

Other allegations involve Choi and a close acquaintance using their influence in a corporate takeover, signaling that her influence extended beyond political affairs.

Choi and film director Cha Eun-taek and other aides are suspected of pressing a small advertising company to sell its shares in Poreka, an advertising affiliate of steel maker Posco that was later taken over by the advertising company Comm. Together.

A source from Comm. Together confirmed that the movie director and close friends threatened the advertising company.

“When Poreka was up for grabs, they [Choi and Cha] also wanted to take over the company,” the source said.

The source said that a recording of the threats exists in which Choi and Cha threaten a government audit.

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