It has been confirmed that financial authorities additionally referred MBK Partners executives to prosecutors in connection with the "Homeplus incident."
According to financial authorities on Feb. 5, the Financial Supervisory Service detected suspected unfair trading by MBK Partners in Dec. last year and notified prosecutors through an emergency measure (fast track) by the chair of the Securities and Futures Commission. The result was reported after the fact at a regular meeting of the Securities and Futures Commission on Jan. 7.
The referral to prosecutors is said to include Chair Kim Byung-ju of MBK Partners and Vice Chair Kim Kwang-il of MBK (co-CEO of Homeplus Co.).
Since Aug. last year, the Financial Supervisory Service, together with the Financial Services Commission, has been conducting a comprehensive review of MBK Partners' acquisition of Homeplus Co.. This process included ▲ attracting fund limited partners (LPs) ▲ financing via a leveraged buyout (LBO) ▲ related asset transaction.
As a result of the investigation, financial authorities are said to have identified indications of unfair trading in some transaction.
Earlier, in Apr. last year, the Financial Supervisory Service also referred MBK Partners executives to prosecutors on suspicion of fraudulent unfair trading over the large-scale issuance of asset-backed short-term bonds (ABSTBs) despite recognizing the possibility of a corporate credit rating downgrade.
From Feb. 17 to 25 last year, MBK Partners issued a total of 116.4 billion won in bonds, including ABSTBs, commercial paper (CP), and short-term bonds (SB). Prosecutors believe MBK Partners concealed the possibility of a credit rating downgrade when selling them.
Prosecutors are also applying charges against three MBK Partners executives, excluding Kim, for ▲ accounting fraud in the 1 trillion won range (violation of the Debtor Rehabilitation and Bankruptcy Act) ▲ manipulating the audit report (violation of the Act on External Audit) ▲ obstructing the business of credit rating agencies.
However, the court rejected all arrest warrant requests for the four people, including Chair Kim Byung-ju. The court determined that the allegations were not sufficiently substantiated to justify arrest.
Accordingly, prosecutors reassigned the case from the Anti-Corruption Investigation Department 3 to Department 2. This is to ensure the objectivity and fairness of the investigation.
Prosecutors plan to reexamine the entire case, including the additional matters referred by the Financial Supervisory Service.