Former Woori Financial Group Chairman Son Tae-seung speaks during a press conference in this photo taken in 2017, when he was then the CEO candidate of Woori Bank, the group's flagship affiliate. Yonhap

Former Woori Financial Group Chairman Son Tae-seung was indicted on Tuesday, over his alleged involvement in more than 50 billion won ($34.73 million) of improper loans taken out by his relatives when he was in office.

The Seoul Southern District Prosecutors' Office said it indicted Son without detention on charges of breach of duty, after it sought to arrest him twice in November and December. However, a court rejected the arrest warrant requests at the time.

The prosecution said Son's alleged offense falls under the act on aggravated punishment for illicit gains of 500 million won or more and therefore seriously undermines national economic ethics.

Former Woori Financial Group Chairman Son Tae-seung enters the Seoul Southern District Court, Nov. 26, to attend a review of the prosecution's request to issue an arrest warrant for him on suspicion of his connection to improper loans taken out by his relatives. Yonhap

The case dented the credibility of Woori Financial Group as the country's fourth-largest financial holding company, and also its flagship affiliate Woori Bank that remains at the center of the allegations.

The bank is suspected of giving loans worth 51.7 billion won to corporations belonging to Son's relatives and acquaintances without observing the firm's own loan approval process.

The 51.7 billion won was offered in divided amounts over 23 times from 2021 to 2023, when Son was the chairman of the group.

“We reckon such inappropriate loans were possible as Son and relevant executives of the bank colluded in a systematic manner,” the prosecution said.

The case raised questions about the internal regulatory system underlined by Woori Financial Group, which was already in doubt over other irregularities concerning its banking employees.

The case also disrupted the group's push to diversify its business portfolio, after it ended more than 20 years of government-led ownership and was fully privatized in 2022.

Formerly Woori Bank CEO, Son led the group from 2019 to 2020, then served an extended term from 2020 to 2023.