The Kobe District Court on Monday sentenced a former chairman of a pro-Pyongyang Korean credit cooperative association to three years in prison, suspended for four years, for breach of trust in connection with illegal loans in 1997 and 1998.
In handing down the ruling for Lee Jong Ho, 62, a former head of the Association of Credit Unions for Korean Residents in Japan, presiding Judge Kenji Sugimori described the crimes as malicious, but he mitigated his condemnation of Lee.
"Such acts as secretly transferring cash that cannot be made public and covering the delays of debt recovery, these bold and cleverly organized crimes are malicious, but it cannot be said that the defendant actively planned and led them," Sugimori said.
The prosecution had demanded a sentence of four years in prison.
According to the ruling, Lee, then president of the now-defunct Chogin Osaka Credit Union, conspired with Lee Bom Rak, 68, another former chairman of the association, and others in September 1997 to cover about 1 billion yen of bad loans at Chogin Osaka.
In an effort to cover the loss, the group had three Chogin credit cooperatives in Hyogo, Kyoto and Aichi prefectures improperly extend loans ranging from about 335 million yen to 350 million yen to Chogin Osaka.
Furthermore, when Lee Jong Ho was head of the association in July 1998, the group convinced Chogin Kinki to improperly extend about 340 million yen in loans to the former Chogin Aichi to cover losses incurred there.
Lee Bom Rak, who is currently on trial for breach of trust, pleaded guilty in February.