The former head of failed credit union Tokyo Shogin, already under arrest on suspicion of embezzlement and extending 1.62 billion yen in illegal loans, provided another 3 billion yen in illegal loans to a Tokyo business group, investigative sources said Wednesday.

Kim Song Jun, 52, allegedly damaged the credit union by loaning 3 billion yen to the business group, owned by Masuo Taneda, 64, without securing sufficient collateral and knowing the money was unlikely to be repaid, the sources said.

The Taneda group's core company is a golf course management firm.

Prosecutors are planning to press another breach of trust charge against Kim, the sources said.

The 3 billion yen in illegal loans includes 1.6 billion yen extended in May 1999 to a karaoke parlor management firm in Tokyo, which has close connections with a popular female "enka" ballad singer, the sources said.

Taneda put up a golf course in Hyogo Prefecture, 53 classic cars and 4,800 bottles of wine as collateral for the karaoke parlor loans.

But Tokyo Shogin did not allow the personal assets -- which were not of sufficient value, anyway -- to be used as collateral.

The sources said the 3 billion yen also included 500 million yen Kim extended through other bodies to Taneda as funds with which to play the stock market.

The sources also said Taneda's business group took over 5.2 billion yen in loans to a major Tokyo Shogin borrower that was near collapse in June 1999, in a bid to conceal the credit union's bad loans.

The illegal loans to Taneda are believed to have been extended in return for the group's pledge to shoulder the problem loans, the sources said.

Kim was originally arrested Sept. 17 on suspicion of embezzling 88 million yen from the credit union, which mainly served pro-Seoul Korean residents in Japan.

On Oct. 5, he was served with another arrest warrant for alleged breach of trust by extending the 1.62 billion yen to Taneda between August 1999 and April 2000. Taneda was also arrested in connection with the case on that day.

Tokyo Shogin, which collapsed in December, was the second-largest credit union serving Korean residents in Japan, after Osaka's Kansai Kogin, which folded the same month.