Venture businessman in loan scandal volunteers to appear before prosecution

From Korea Herald Venture businessman in loan scandal volunteers to appear before prosecution Jin Seung-hyon, a successful venture businessman whose alleged illegal loan scam has been rocking the nation for days, yesterday delivered his intention to voluntarily appear before the prosecution sometime this weekend, officials said. The 27-year-old president of MCI Korea, who is accused of securing illegal loans and stock price manipulations, said he would turn himself in to the prosecution after paying back his illegal loans by tomorrow, prosecutors said. Jin's latest decision notwithstanding, prosecutors vowed to step up efforts to take him into custody as soon as possible. Jin went into hiding in September when the Financial Supervisory Service (FSS) was investigating suspicions of his stock price manipulations. The FSS found that Jin boosted the share price of Regent Securities from around 14,000 won ($13) to 35,000 won between October and November last year. Prosecutors suspect that the president of the securities firm, Ko Chang-gon, and James Mellon, the chairman of Britain's Hong Kong-based iRegent Group, colluded with Jin in the manipulation scheme. Both Ko and Mellon are denying the charges, but prosecutors said they would investigate them. The venture capitalist, who was once dubbed a prodigy in corporate mergers and acquisitions (M&As) as he became the head of nine firms in less than two years, is also suspected of taking out a total of some 255 billion won in illegal or abnormal loans. However, some of the loans cannot be used to bring criminal charges against Jin as he used legal loopholes in obtaining them to avoid punishment. One of the illegal incidents that Jin is certain to be charged for is his obtaining of 37.7 billion won in loans from Yeollin Mutual Savings & Finance, in which he is a majority shareholder. After taking Jin into custody, prosecutors plan to focus their questioning of him on the destination of the illegal loans to verify suspicions that some of them went to government officials, including FSS inspectors, in return for favors. A senior FSS official was found to have accepted about 100 million won from Shin In-chol, an accomplice of Jin that has already been arrested. Prosecutors plan to indict the FSS official, Kim Young-jae, 53, an assistant governor at the financial watchdog, today. Rumor has it that Jin used some of the illegal loans to create slush funds to bribe officials. Jin has denied allegations of illegal lobbying in numerous interviews with local media outlets, saying that he spent the money for management purposes only. However, prosecutors have so far discovered only about 2 billion won worth of slush funds created by Shin. Moreover, prosecutors have determined that Shin used most of the slush funds for personal purposes. Denouncing the prosecution for failing to take Jin into custody early and giving him time to defend himself in press interviews, critics said that the prosecution would have difficulty in getting to the bottom of the scandal as the venture businessman has had sufficient time to prepare for the investigation. By Chang Jae-soon Staff reporter 2000.11.30