The Financial Supervisory Service postponed again its decision on the level of sanctions against MBK Partners over the Homeplus Co. case.
According to financial authorities on the 15th, the Financial Supervisory Service (FSS) was set to hold a sanctions review committee meeting that day to determine the level of sanctions on MBK, but it put off a decision, saying further discussion was needed.
The Financial Supervisory Service (FSS) gave MBK prior notice in November last year of a plan to impose a heavy penalty, including suspension of duties, and held a sanctions review on the 18th of last month, but it still failed to reach a conclusion at the time.
The Financial Supervisory Service (FSS) is examining whether MBK, when Homeplus Co.'s credit rating was downgraded, infringed on the interests of investors (LPs) including the National Pension Service in the process of adjusting the redemption terms of redeemable convertible preferred shares (RCPS) in a way favorable to Homeplus Co.
MBK has countered that the changes to the terms at the time were measures to prevent a sharp drop in Homeplus Co.'s credit rating and to protect corporate value. It said the decision was an operational judgment necessary to protect investors.
In the industry, some say the fact that courts recently dismissed all arrest warrants for four executives, including MBK Chairman Kim Byung-joo, may be one reason the sanctions review is dragging on.
Earlier, the third anti-corruption investigation division of the Seoul Central District Prosecutors' Office sought arrest warrants on allegations that Kim and others issued a large amount of asset-backed short-term bonds (ABSTBs) while recognizing the possibility of a downgrade in Homeplus Co.'s credit rating, and that they violated accounting procedures in the process of changing the RCPS terms, including alleged fraud under the Act on the Aggravated Punishment, etc. of Specific Economic Crimes and violations of the Financial Investment Services and Capital Markets Act. However, the court did not grant the request, saying, "The harm is clearly serious, but based on the materials submitted so far, the allegations are not sufficiently substantiated to the extent that the need for arrest can be recognized."