The Financial Supervisory Service (FSS) has moved up the schedule for its regular inspection of Shinhan Bank, which has recently experienced a series of embezzlement incidents. Originally planned for May to June, the regular inspection of Shinhan Financial Group and Shinhan Bank is now expected to take place about a month earlier.
According to industry sources, the FSS sent a list of preliminary requested documents to the audit departments of Shinhan Financial Group and Shinhan Bank earlier this month in preparation for the inspection. This move is interpreted as a response to the recent financial incidents at Shinhan Bank.
On the 7th, Shinhan Bank announced that it had detected suspicious activities through its internal monitoring system and launched an investigation into Employee A, who had worked at the Apgujeong branch in Gangnam. Employee A is suspected of embezzling KRW 1.7 billion over three years, from December 2021 to July last year.
Employee A was responsible for non-L/C (Letter of Credit) transactions for export companies and allegedly forged customer documents to execute fraudulent loans and siphon off funds. According to Shinhan Bank, Employee A had transferred to another branch before recently submitting a resignation request.
Earlier this year, another financial incident involving KRW 1.998 billion occurred at Shinhan Bank. This case, identified as an external fraud incident, spanned approximately three years from April 2021 to April last year.
Additionally, last year, a loan officer at one of Shinhan Bank’s branches was found to have manipulated credit evaluations to improperly approve loans worth KRW 1.34 billion, highlighting weaknesses in the bank's internal controls.
Currently, the FSS is conducting a regular inspection of BNK Financial Group. Once this process is complete, it plans to immediately commence the inspection of Shinhan Financial Group and Shinhan Bank.
Notably, regarding the recent KRW 1.7 billion embezzlement case, Shinhan Bank’s internal investigation suggests that the total damage could expand to several hundred billion won. Consequently, the FSS intends to conduct a comprehensive review of Shinhan Financial Group’s internal control system.
An FSS official stated, "Given the series of financial incidents, we plan to thoroughly examine the entire internal control system," adding, "If necessary, additional measures will also be considered."
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Shinhan Bank Hit by Multi-Billion Won Embezzlement, FSS Moves Up Regular Inspection
The Financial Supervisory Service (FSS) has moved up the schedule for its regular inspection of Shinhan Bank, which has recently experienced a series of embezz
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