OSAKA – Three former executives of a failed credit union that mainly served the South Korean community received suspended prison sentences Monday from the Osaka District Court for extending illegal loans.
Lee Hui Gon, 85, former chairman of Kansai Kogin, and Lee Jong Rim, 63, former president, were sentenced to three years in prison. Pak Chung Hong, 59, former vice president, was handed a 2 1/2-year sentence.
All were suspended for up to five years. They pleaded guilty to breach of trust and other charges but sought suspended terms.
According to Judge Masanori Tsunoda, the amount of the loans was huge and the responsibility of the defendants is grave, but it was not proven they extended the loans for personal gain. They have also shown repentance, Tsunoda said.
Although Lee Jong Rim bears the greatest responsibility in the case, the judge said, his role as a key member of the South Korean community in Japan should be taken into account.
The three caused the Osaka-based credit union to incur huge losses by extending a combined 5.1 billion yen in loans to a golf course operator between September 1997 and March 1999.
They extended the loans to the financially ailing union-affiliated firm despite knowing that the money was unlikely to be repaid.
Lee Jong Rim also paid a total of 200,000 yen in bribes to Masatoshi Yahata, a former financial and securities inspector of the Kinki Finance Bureau, between May and August of 1999 in return for tipping him off that a financial inspection was imminent.
Yahata, 46, is being tried separately for bribery.
The credit union became insolvent in 2000. Kinki Sangyo credit union, based in Kyoto, took over Kansai Kogin’s businesses last summer.
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