South Korea`s prime minister promised Tuesday to try and seize all assets held by the reclusive patriarch whose family runs the ferry operator of the ship which sank last month, killing hundreds.
Prosecutors last week asked for a court-issued arrest warrant after billionaire businessman Yoo Byung-Eun failed to heed an official summons for questioning about corruption and his role in the ferry operator.
"The government should try and confiscate all his fortune," Prime Minister Chung Hong-Won said in parliament.
He also said financial regulators would investigate Yoo`s hidden assets for use in paying compensation to relatives of the ferry victims.
Yoo has no direct stake in the ferry operator, Chonghaejin Marine Co., but his sons and close aides control it and sister firms through a complex web of holding companies.
The arrest warrant application has yet to be approved as the 73-year-old`s whereabouts are unclear, prompting investigators to hunt for him.
There have been concerns that efforts to enforce a warrant could trigger a volatile showdown with the Evangelical Baptist Church of Korea, a splinter church group founded by one of Yoo`s relatives.
Hundreds of followers have been holed up for two weeks in the church`s compound in Anseong south of Seoul with newspapers reporting that Yoo, who is a leading figure in the church, may also be hiding there.
The church followers have blockaded themselves in to the compound, warning that any police effort to force entry would be regarded as "religious persecution" and lead to a "dangerous" situation.
Chung stepped down last month over the ferry disaster but while his resignation was accepted, he was asked to remain in his post until the recovery of bodies is completed.
Prosecutors have said that charges will include embezzlement and tax evasion but will not give a full list of precise charges until Yoo is officially arrested.
Yoo, who has described himself as an artist and photographer, has a colourful and checkered past. He was once convicted of fraud when a company under his control went bankrupt.
The church has an estimated 20,000 followers and, under a different name, made headlines in 1987 following the mass suicide of 32 members.
Yoo was investigated but cleared of any involvement in that incident.
Prosecutors investigating the ferry disaster have already raided Yoo`s home, and his eldest son, Yoo Dae-Gyun, is also being sought after ignoring an official summons.
The 6,825-tonne Sewol was carrying 476 people when it capsized and sank on April 16. So far, 287 people have been confirmed dead, with 17 still unaccounted for.
The Sewol`s captain and three crew members were charged last week with manslaughter through gross negligence.
Five Chonghaejin officials have already been arrested for possible criminal negligence, and the investigation has widened to the Yoo family and possible fraud and tax evasion charges.