Former Lone Star Funds official arrested in New Jersey

The Justice Ministry holds a press conference on the arbitration ruling related to Lone Star Funds on August 2022. [NEWS1]

A former official of Lone Star Funds was arrested in New Jersey on Thursday, according to the Korean Ministry of Justice.

The Justice Ministry said in an announcement Sunday that Steven Lee, who faces allegations of manipulating financial records to acquire a local bank, along with embezzlement and tax evasion, was arrested in the northeastern state last week.

Lone Star, a Dallas-based private equity firm, had acquired Korea Exchange Bank for the below-market price of 1.38 trillion won in 2003 and sold it to Hana Financial Group, pocketing a hefty profit. Lee allegedly colluded with Korean governmental and financial authorities in the process.

The arrest comes 17 years after the Korean government requested the U.S. authorities to extradite him in 2006, as a result of the Korean officials actively cooperating with the U.S. counterparts to share the recent analysis on Lee's location, according to the ministry.

The ministry announced that it plans to expedite Lee's extradition through further coordination with the U.S. justice authorities and vowed to track down and punish all criminal suspects who are hiding overseas.

BY SOHN DONG-JOO [sohn.dongjoo@joongang.co.kr]