The government on Wednesday approved the establishment of four new credit unions to take over the banking operations of six failed credit unions accused of diverting funds to North Korea.
The Financial Services Agency and the Finance Ministry's Kanto and Kinki finance bureaus authorized the six Chogin credit unions to transfer their operations to the four new lenders, provided the four lenders sever ties with the pro-Pyongyang General Association of Korean Residents in Japan, or Chongryon.
The takeover of the six failed credit unions, including Chogin Kinki Credit Union and Chogin Tokyo Credit Union, completes the process of consolidating and liquidating a total of 16 Chogin credit unions that have gone bust since the first -- Chogin Osaka Credit Union -- failed in May 1997.