The Tokyo District Public Prosecutors' Office has arrested the former head of Tokyo Shogin Shinyo Kumiai, a failed credit union mainly serving South Korean residents, for allegedly embezzling 86 million yen from the union, the office said.

Arrested on suspicion of embezzlement was Kim Song Jung, 52, of Tokyo, prosecution officials said.

Since his arrest Monday, Kim has reportedly owned up to part of the prosecution's allegations, saying he took over from what his predecessor had been doing. Kim is the son-in-law of his predecessor, who ruled Tokyo Shogin for 27 years until his retirement in 1994.

But he has denied that he pocketed the money for his own gain, insisting he needed secret funds to pay for social expenses incurred as head of the credit union, according to investigators.

Police have found that part of the money had been used to pay for his golf fees.

Law-enforcement officers from the prosecutors' office on Tuesday searched the headquarters of Tokyo Shogin for the third time.

Kim is suspected of having pocketed around 40 million yen, paid to Tokyo Shogin by South Korean-affiliated credit unions in eastern Japan in return for access to an online computer system, between January 1995 and last December, sources said. Kim deposited the money into an account held under a fictitious name, they alleged.

Kim is also suspected of embezzling around 20 million yen in employees' salaries, which was paid by Tochigi Shogin, a credit union affiliated with Tokyo Shogin. The employees were on loan from Tokyo Shogin, according to other sources. He is also suspected of embezzling approximately 26 million yen from the accounts of Tokyo Shogin affiliates Tokyo Supply Co. and Toshin Property Co.

Kim reportedly admitted to spending the bulk of the 26 million yen on golf, dinners and taxi fares.

When Tokyo Shogin applied to the government's former Financial Reconstruction Commission, which has since been taken over by the Cabinet Office, to begin insolvency proceedings in December, Tokyo Shogin checked the accounts of its affiliates and found about 100 million yen missing, the sources said.

Prosecutors searched Tokyo Shogin's head office in June. They arrested the former head of the credit union's Ikebukuro branch on Sept. 5 on suspicion of embezzling 75 million yen in savings from accounts opened under fictitious names.