FSS Suspects KEB of Stock Price Manipulation Prosecutors Seek Arrest of Lone Star Executives Ex-KEB President 'Faces Arrest' in Sale to Lone Star Court Refuses Arrest Warrants for Lone Star Execs Prosecutors Furious at Rejection of Arrest Warrants Prosecutors Insist There's Evidence Against Lone Star Ex-KEB Chief Arrested Over Sale to Lone Star All Sides in Lone Star Probe Must Grow Up Hyundai Insurance CEO in Lone Star Bribery Allegations Prosecutors 'Have Fresh Evidence on Lone Star Execs' Arrest Warrants for Absent Lone Star Execs Chief Justice 'Can't Remember' Meeting Lone Star Bigwig Prosecutors Call Court's Bluff Over Lone Star Bigwig Lone Star Threatens to Leave Kookmin in the Cold Lone Star Scraps KEB Sale to Kookmin Lone Star Is Trying to Lean on the Law KEB Sale to to Lone Star Could Be Voided Findings in Controversial KEB Probe Announced Who Was in Charge of the KEB Sale? KEB Chief in Tokyo Meeting With Lone Star Bigwigs

The Supreme Public Prosecutor’s Office announced that it believes the Korea Exchange Bank was illegally sold to the offshore investment firm Lone Star by as much as W825 billion (US$1=W916) below the true market price.

In investigation results released Thursday, prosecutors allege that the former director general of the Finance Ministry's Financial Policy Bureau Byeon Yang-ho and former KEB president Lee Kang-won conspired with Lone Star to underrate the bank’s assets and exaggerate the bank’s bad loans to drive the price down to W344- 825 billion below what it should have sold for. The investigation also revealed that by lowering the bank’s BIS capital adequacy ratio unjustly, executives with the bank and Lone Star persuaded the Financial Supervisory Commission to give final approval to the takeover of the bank by Lone Star, prosecutors said.

Prosecutors arrested six people including Lee Kang-won and Hyundai Marine and Fire Insurance president Ha Jong-sun, then a lawyer for Lone Star, and indicted nine others including Byeon Yang-ho without detention.

(englishnews@chosun.com )