Ex-Tokyo Shogin head pleads guilty to embezzlement+.
The former head of failed credit union Tokyo Shogin pleaded guilty in a trial Thursday to charges of breach of trust and embezzlement over a total of 3.3 billion yen in loans extended illegally to a company.
In the first hearing at the Tokyo District Court, Kim Song Jung, 52, former head of the credit union that mainly served pro-Seoul Korean residents in Japan, admitted to the charges that he illegally lent money to a Tokyo business group run by Masuo Taneda, 65, in order to hide bad loans of the credit union.
But Kim denied part of charges, saying he did not commit illegal lending for personal profit and that he had only used a secret fund held by the credit union, while Taneda denied the charges at the same hearing.
According to the indictment, Kim and Kim Ri Jo, 54, the union's former managing director, allegedly damaged the union by extending a total of 3.22 billion yen in loans to Taneda's group via two Tokyo Shogin affiliates between May 1999 and April 2000.
Prosecutors said in the opening statement that Kim Song Jung was forced to hide the credit union's bad loans because he was sued by the labor union for shady loans in 1995.
Kim asked Taneda to buy up the loans and Taneda asked Kim for the illegal loans in return, the prosecutors said.
Taneda put up a golf course in Hyogo Prefecture, 53 classic cars and 4,800 bottles of wine as collateral for the loans, although the assets did not constitute sufficient collateral for the loans, the indictment said.
Taneda said, denying the charges, that the collateral was sufficient.
Taneda allegedly used part of the money to purchase shares in a software development firm for speculative trading.
Kim is also suspected of embezzling about 87 million yen from the Tokyo Shogin fund, which he deposited in an account set up using an assumed name, and using it for trips to South Korea and golf. Kim allegedly embezzled the money by issuing false expense bills to the company, the prosecutors said.
Tokyo Shogin, which collapsed in December last year, was the second-largest credit union serving Korean residents in Japan following Osaka's Kansai Kogin, which also folded in December.