Shinkumi Bank for Koreans in Japan Ordered to Suspend Biz

Sapporo, June 12 (Jiji Press)–Japan’s Financial Services Agency on Friday ordered a “shinyo kumiai” credit association, or shinkumi bank, for Korean residents to suspend part of its operations after its management team was found to have covered up an executive’s embezzlements of customer deposits. Uri Shinkumi Bank, based in Sapporo, the capital of the northernmost Japan prefecture of Hokkaido, was ordered not to extend loans to new customers for a month from July 14. The FSA will also consider filing a criminal complaint against Uri Shinkumi Bank for obstructing its inspections, such as giving false explanations to inspectors. The executive in question pocketed a total of as much as 1.4 billion yen in customer deposits. Separately, four cases of embezzlements by employees have also been found. In addition, the bank accepted deposit accounts opened with fictitious or someone else’s names. The bank has been ordered to report the series of fraudulent activities but omitted some of them from its report submitted to the FSA. Following the partial business suspension order, Uri Shinkumi Bank announced the resignation of its head. A deputy head offered an apology at a press conference held in Sapporo on Friday, saying, “We take the situation seriously.” The bank will set up a committee of outside lawyers to investigate the misconducts. Uri Shinkumi Bank was established in 1965 as Chogin Hokkaido Shinyo Kumiai and adopted its current name in 2004. At the end of March 2025, it had 100 billion yen in deposits, with the balance of loans standing at 85.9 billion yen. Among other shinkumi banks, Iwaki Shinkumi Bank, based in the city of Iwaki, Fukushima Prefecture, northeastern Japan, received a partial business suspension order from the FSA last year for fraudulent loans extended through accounts opened without the consent of depositors and the provision of funds to antisocial forces. END [Copyright The Jiji Press, Ltd.]