Prosecutors have launched an investigation into accusations that the head of Woongjin Group, a troubled mid-size conglomerate, fraudulently issued commercial papers, officials said Friday.

The probe comes as the nation’s securities regulator reported Yoon Seok-keum and four other executives of the conglomerate to the Seoul prosecution for alleged unfair trading last month.

Officials of the regulator have recently been summoned for questioning, prosecutors said, adding that they will soon call in Woongjin executives to question whether there were irregularities in the process of issuing CPs.

The five are accused of issuing CPs worth around 100 billion won ($91 million) under the name of the group last July even with prior knowledge that the group had lost its ability to pay back its debt in the aftermath of a credit rating downgrade, according to the Securities and Futures Commission, an arm of the Financial Services Commission that looked into the case.

In September, they issued more CPs worth 19.8 billion won without publicizing the fact that the group had applied for management normalization of Woongjin Holdings with the court after scrapping its earlier plan to dispose of Woongjin Coway, the commission added. (Yonhap News)