Lee Sang-deuk, 78, was convicted Thursday of receiving kickbacks worth more than $654,000 from a local company and two troubled banks, Yonhap news agency reported.
He was sentenced to two years in prison and a fine of $654,165.
A former six-term legislator, he was considered one of the most powerful figures in his younger brother's presidency.
The president had come under criticism after his aides raised the possibility he might issue a special pardon on the Lunar New Year.
Pardons cannot be issued until a person's sentence has been finalized.