South Korea's Supreme Public Prosecutors' Office has announced that it is investigating the activities of Lee Jae-kwan. The ex-vice chairman of the Saehan Group is suspected of false accounting to the tune of US$1.14 billion on the back of which he illegally obtained loans worth about US$76 million from four or five financial institutions.

Seoul District Court indicted Lee without detention last year on the charge of receiving a fraudulent loan of US$76 million by using a fake letter of credit (L/C). It is not known whether the investigators are looking into further L/C abuses.

Lee, the grandson of the late Lee Byeong-cheol, the founder of Samsung, and a nephew of the current Samsung Corporation Chairperson, Lee Kun-hee, allegedly reported inflated profits of around US$38 million at Saehan Corporation and around US$76 million at Saehan Media.

Lee is also suspected of unlawfully assigning some US$1.5 billion to shareholders in 1999, reporting profits when in fact the company had none. Prosecutors said they assume this was done with the aim of preventing the firm being labeled as unreliable on the stock markets.

This article represents the views of the author and not necessarily those of the ICC or any of the other partners in DC-PRO.