Prosecutors currently investigating the "Homeplus Co. affair" sought arrest warrants on the 7th for Kim Byung-ju, chairman of MBK Partners, and Kim Kwang-il, vice chairman of MBK Partners and head of Homeplus Co.
According to legal sources, the Seoul Central District Prosecutors' Office's Anti-Corruption Division 3 (acting Director General Prosecutor Kim Bong-jin) on this day sought arrest warrants for four people, including Chairman Kim and Vice Chairman Kim, on charges including fraud under the Act on the Aggravated Punishment of Specific Economic Crimes and violations of the Financial Investment Services and Capital Markets Act.
Prosecutors believe Homeplus Co. and its major shareholder MBK, despite anticipating the possibility of a credit rating downgrade in Feb. last year, concealed it and issued 82 billion won worth of asset-backed electronic short-term bonds (ABTSB), then filed for corporate rehabilitation, causing losses to bond investors.
In the course of the investigation, prosecutors found that MBK executives, including Chairman Kim, recognized Homeplus Co.'s operating deficit status from the end of 2023. They also judge that by mid-Feb. last year, MBK executives were aware that Homeplus Co.'s credit rating could be downgraded.
Korea Ratings on Feb. 28 last year downgraded Homeplus Co.'s credit rating from "A3" to "A3-." Four days later, on Mar. 4, Homeplus Co. applied to the Seoul Bankruptcy Court for corporate rehabilitation procedures (court receivership).
Chairman Kim appeared at the National Assembly's audit in Oct. last year and, regarding Homeplus Co.'s application for corporate rehabilitation, said, "It is not within my authority," and added, "It was a matter decided by the Homeplus Co. board of directors."