South Korea special prosecutor detains pension fund chairman

South Korea special prosecutor detains pension fund chairman
PHOTO: KHIDI

SEOUL - A South Korean special prosecution team investigating the corruption scandal that has engulfed the country's presidency said it had placed the chairman of the National Pension Service (NPS) under emergency detention early on Wednesday.

The special prosecutor's office did not immediately provide further details on the arrest of NPS Chairman Moon Hyung-pyo but had said on Monday it had raided Moon's home on suspicion of abuse of power.

The special prosecutor has been looking into whether Moon pressured the pension fund to support the $8 billion merger last year of two Samsung Group (SAGR.UL) affiliates while he was head of the Ministry of Health and Welfare, which runs the NPS.

The merger was criticised by some investors for strengthening the founding family's control of the group at the expense of other shareholders.

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The influence-peddling scandal led parliament to vote on Dec. 9 to impeach President Park Geun-hye, a decision that must be upheld or overturned by the country's Constitutional Court within 180 days.

Investigators are also examining whether Samsung's support of a business and foundations backed by Park's friend Choi Soon-sil may have been connected to NPS' support of the merger, a prosecution official told Reuters last week.

Park has denied wrongdoing but apologised for carelessness in her ties with Choi, who has also denied wrongdoing.

Last week, investigators raided the office of the NPS, the world's third-largest pension fund.

Under South Korean law, a suspect can be held under emergency arrest without a warrant for up to 48 hours.

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