2025-03-11
(Pulse by Maeil Business News Korea, Mar. 12)
South Korea’s National Tax Service (NTS) launched a sweeping tax investigation into private equity firm MBK Partners Ltd, drawing attention to its background.
According to industry sources on Tuesday, the NTS initiated the investigation early this week, which involves the Seoul Regional Tax Office’s Investigation Division 4.
Given that the Investigation Division 4 handles special audits, the latest investigation is fundamentally different from the 2020 audit, a source said.
There was also speculation that the NTS may have obtained information suggesting tax evasion by MBK, as the Investigation Division 4 typically conducts premeditated probes.
During the regular tax investigation in 2020, MBK was found guilty of offshore tax evasion and fined 42 billion won ($28.9 million).
The latest investigation involves a team of seven to eight investigators, sources said.
Some also view the latest investigation as a response to local discount retailer Homeplus Co.’s sudden corporate rehabilitation filing, which resulted in financial losses for individual investors who invested in Homeplus bonds.
MBK is Homeplus’ majority shareholder, and it was said that the investigation could be a warning message to MBK about its moral hazard, rather than solely focusing on tax evasion allegations.
MBK Partners Chairman Kim Byung-ju, in the meantime, is under criticism for evading his responsibilities. His behavior contrasts sharply with past cases in which business leaders facing crises such as court receivership or bankruptcy issued public apologies and contributed personal assets to address the situation.
Some argue that Kim should demonstrate his sincerity by offering personal financial contributions and making a public apology, while political pressure is also mounting on him.
The National Assembly’s National Policy Committee convened a plenary session on Tuesday and decided to summon five key figures for an emergency hearing on the Homeplus case next Tuesday, including Kim and MBK Partners Vice Chairman and Homeplus Co-CEO Kim Kwang-il.
“Kim [Byung-ju] cannot avoid responsibility for this crisis,” according to Representative Lee Jung-mun, senior vice chairman of the Democratic Party of Korea’s Policy Committee.
※ Please refer to the article: MBK Partners under Korea tax agency scrutiny – 매일경제 영문뉴스 펄스(Pulse)
