Corruption among state officials is threatening South Korea’s transition from emerging market to developed economy, Lee Myung-bak, president, has said after a banking scandal put graft in the spotlight.
Prosecutors are investigating whether regulators ignored corruption at several savings banks in return for tens of thousands of dollars in cash bribes and, in one case, a diamond.
Seoul has been trying to persuade foreign investors that it has flushed out corruption since the Asian financial crisis of 1997-98, when some of South Korea’s biggest companies collapsed because of illicit relations between executives, bankers and state officials.
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