SEOUL, Nov. 12 (Yonhap) -- Cable channel MBN said Tuesday that its chairman will step down from the top post to take responsibility for allegations over accounting fraud.
Earlier in the day, prosecutors indicted MBN, run by Maeil Business Newspaper, and its executives including Vice Chairman Lee Yoo-sang on charges of committing accounting fraud worth 55 billion won (US$47.3 million).
In 2011, MBN was to raise 300 billion won to meet the requirement for a general programming cable TV network license. The company is suspected of having manipulated its balance sheet to conceal the buyback of about 55 billion won, according to prosecutors and financial authorities.
"We seriously accept the result of the prosecutors' investigation," MBN said in a statement. "To shoulder responsibility for the suspicions, Chairman Chang Dae-whan will resign and step back from company affairs."
The company also said it will make constant efforts to improve its capital structure and establish a transparent accounting system.
Insiders, meanwhile, pointed out that the indictment may not largely affect the renewal of MBN's license scheduled for November next year but will be a hot potato if this issue remains unsolved for a year.
Since MBN, JTBC, TV Chosun and Channel A won new general programming licenses in 2011, they are subject to a review of the permissions by the Korea Communications Commission (KCC) every three years.
"If the KCC has to consider this issue during the review process, this will be important," Professor Choi Jin-bong from Sungkonghoe University said.
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