UANI

"South Korean prosecutors have detained and charged a Korean American with the illegal transfer of a staggering 1.09 trillion won ($1.02 billion) in Iranian money frozen in South Korea under international sanctions, the lawyers said on Friday. The Seoul Central District Prosecutors' Office said a 73-year-old man, identified only by his family name, Chung, was suspected of making fraudulent transfers in 2011 from the Iranian central bank's won-denominated account at a South Korean bank by using fake invoices for payment. Prosecutors marveled at the scale of the withdrawals, indicating they believed there had to be more than one person involved. The prosecutors' office said those involved took advantage of a banking procedure that was now more tightly supervised... The prosecutors' office and the Industrial Bank of Korea (IBK) confirmed media reports that identified the state-owned lender as the financial institution that held the Iranian central bank account. IBK had received a payment order from the Iranian central bank, the bank and prosecutors said. It believed the order to be authentic because Chung had attached authorization from the Bank of Korea and a government agency that tracks exports of goods to countries under international sanctions, the prosecution said." (Reuters, "South Korea reveals staggering $1 billion transfer fraud in Iranian money," 1/25/13)

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"In response, Rabobank and Société Générale say they have stopped servicing Iran deals or curbed their trade finance. According to Iranian trade professionals, Korea's Woori Bank and Industrial Bank of Korea have done the same. The Korean banks could not be reached for comment." (The Wall Street Journal, "Willing Banks Find Profits in Legal Trade With Iran," 4/8/2012)

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Industrial Bank of Korea is one of South Korea's largest banks. It is a publicly-owned institution specializing in loans for small and medium-sized corporations. IBK is also involved in consumer banking, investment banking, and asset management (Google Finance).

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In October of 2010, the South Korean government appointed IBK to "finance commerce with Iran and revive business ties damaged by sanctions." The deal allows the Iranian central bank to deposit proceeds from oil sales at IBK, which will use the funds to pay South Korean firms exporting to Iran. South Korean trade with Iran amounts to $10 billion annually (Financial Times).