South Korea's prime minister, who has denied an allegation that he took illegal campaign funds from a businessman who committed suicide, has offered to resign over the scandal, the presidential office said.
The scandal threatens to weaken President Park Geun-hye and her Saenuri Party, which faces a parliamentary election early next year for control of the 300-seat assembly.
Prime Minister Lee Wan-koo has denied he received campaign funds from businessman Sung Wan-jong, but pressure mounted against him to step down after news reports showed he had known Sung well.
That was despite his claim that he barely knew the construction company boss who was close to politicians. Lee has not commented since his resignation offer became public on Tuesday.
Sung, who was under investigation for fraud and bribery, was found earlier this month hanging by his necktie from a tree.
Park's spokesman said in a statement issued in Peru she had received Lee's offer to resign.
The president, who is on a four-country trip to South and Central America, was widely expected to accept Lee's resignation and replace him, Reuters news agency reported.
The largely ceremonial post of prime minister is the official head of the cabinet, which is appointed by the president and administers policy set by the government and approved by parliament.
Park, who is in the middle of a single five-year term, said last week nobody should be exempt from scrutiny for corruption or wrongdoing and indicated she would dismiss anyone who is found guilty of such charges.
Sung said in an interview with a Korean newspaper hours before he was found dead on a mountainside in northern Seoul that he had given political funds to Park's close aides and to prominent Saenuri Party members.
Lee was alleged to have received $28,000 from Sung in 2013 when he was seeking re-election for parliament.
Prosecutors found a note on Sung's body making similar accusations, which they said was in Sung's handwriting.
Political contributions in excess of $92 were made illegal under a campaign finance law passed in 2004, when the Saenuri Party - then known as the Grand National Party - was battling an earlier bribery scandal.
Corporations are banned from making political donations under that law, which is aimed at severing ties between the government and businesses looking to secure favours.