Chief of World’s Third-Largest Pension Detained in Corruption Probe

The Chairman of Korea’s National Pension Service (NPS) — the third largest pension fund in the world — was placed under emergency arrest on Wednesday as part of a corruption probe that has already ensnared the country’s president.

Prosecutors are looking into whether NPS Chairman, Moon Hyung-pyo, coerced the fund to vote in favor of a merger of two companies.

More details from Reuters:

The special prosecutor has been looking into whether Moon pressured the pension fund to support the $8 billion merger last year of two Samsung Group [SAGR.UL] affiliates while he was head of the Ministry of Health and Welfare, which runs the NPS.

Investigators are also examining whether Samsung’s support for a business and foundations backed by the president’s friend, Choi Soon-sil, who is at the center of the influence-peddling scandal, may have been connected to NPS support for the merger, a prosecution official told Reuters last week.

The NPS voted in favor of the merger without calling in an external committee that sometimes advises it on difficult votes.

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At a parliamentary hearing this month, Samsung Group scion Jay Y. Lee denied allegations from lawmakers that Samsung lobbied to get the NPS to vote in favor of the merger, or that it made contributions seeking something in return.