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Korea President’s Brother Questioned Over Bank Scandal

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(Corrects age of president’s brother in story published on July 3)

July 3 (Bloomberg) -- South Korean President Lee Myung Bak’s older brother was questioned by prosecutors today over a savings bank bribery scandal.

Lee Sang Deuk, 76, who served six terms in parliament, reported to the Supreme Prosecutors’ Office in Seoul with his lawyer at 10 a.m. local time, said Choi Woon Sik, head of the prosecution’s savings bank investigation team. He declined to specify any charges against Lee as the investigation is ongoing.

“I will faithfully participate in the questioning,” Lee told reporters before entering the prosecutors’ office, declining to answer further questions.

Prosecutors have indicted nearly 200 people and ordered at least two jail sentences after uncovering illegal lending and lax oversight among bankers, regulators, politicians and lobbyists. The Financial Services Commission has closed 20 savings banks since January 2011 and more than 88,000 depositors and bond holders have lost more than 1 trillion won ($878 million).

The president’s ruling party has struggled to overcome a series of scandals, including a bribery investigation that forced the resignation of the speaker of the National Assembly. Lee’s non-renewable five-year term ends next February after an election on Dec. 19.

His office did not have any comment on the prosecution’s probe and summons, spokeswoman Lee Mi Yon said.

To contact the reporter on this story: Sangwon Yoon in Seoul at syoon32@bloomberg.net

To contact the editor responsible for this story: Peter Hirschberg at phirschberg@bloomberg.net

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