South Korean prosecutors are questioning MBK Partners Chair Michael Byung-ju Kim as a suspect over allegations that Homeplus issued and sold bonds despite an expected credit-rating downgrade. The Seoul Central District Prosecutors' Office's second anti-corruption division began questioning Kim on Thursday, marking his first summons since the case was reassigned. He faces suspected fraud charges under the Act on the Aggravated Punishment of Specific Economic Crimes and alleged violations of the Financial Investment Services and Capital Markets Act. MBK Partners, Homeplus' majority shareholder since acquiring the retailer in 2015, is accused of causing investor losses by approving bond issuance while allegedly aware of the downgrade risk. A court rejected January arrest-warrant requests for Kim and three other Homeplus executives, citing insufficient evidence for detention. Homeplus filed for corporate rehabilitation in March last year and came close to a complete shutdown in July before Meritz Financial Group approved a 200 billion won ($149 million) debtor-in-possession loan and MBK agreed to provide a joint guarantee for the same amount.