Financial Supervisory Service (FSS) Governor Lee Chan-jin stated today (July 21) regarding the Homeplus situation that he would "proceed with sanction procedures transparently and swiftly regarding any illegal activities."

Governor Lee attended a meeting of the National Policy Committee on the rehabilitation of Homeplus held at the National Assembly in Yeouido, Seoul, this morning. During the meeting, he emphasized this point while explaining the sanction procedures the FSS has been conducting.

"We are currently in the process of taking sanctions after investigating violations of the Capital Markets Act during our on-site inspection of MBK Partners, and we have also conducted inspections on Hana Securities and others (regarding allegations of mis-selling electronic short-term bonds)," Lee said.

Earlier this month, the FSS decided to impose heavy sanctions, including the "suspension of duties," on MBK Partners in connection with the Homeplus situation.

It is reported that the FSS concluded that MBK committed acts of unfair business practices and violated internal control obligations under the Capital Markets Act.

The FSS appears to have determined that MBK modified the terms of Redeemable Convertible Preference Shares (RCPS) through a Special Purpose Company (SPC) established for the acquisition of Homeplus in a way that favored Homeplus, thereby waiving redemption rights. In this process, it is believed that they infringed upon the interests of investors (LPs), such as the National Pension Service, by reducing the possibility of recovering their investments.

Furthermore, Governor Lee added, "The FSS will cooperate closely with relevant agencies to minimize damage to workers at tenant companies."

Regarding the losses from Homeplus electronic short-term bond investments, he stated, "The investigation into mis-selling is virtually complete," and added, "We are actively reviewing relief measures."

According to the Financial Services Commission, financial support for partner companies has been provided in 7,682 cases, totaling 5.13 trillion won.

Liquidity support exceeding 440 billion won has also been provided through guarantees from the Korea Credit Guarantee Fund and the Korea Technology Finance Corporation.

(Photo: Yonhap News)