"No Unjust Sanctions"... Financial Supervisory Service Operates Sanction Exemption Deliberation Committee

[Asia Economy Reporter Kim Hyo-jin] The Financial Supervisory Service (FSS) announced on the 8th that it has introduced a discharge application system that allows executives and employees of financial companies to actively claim discharge regarding inspection findings, and established a 'Disciplinary Discharge Deliberation Committee' to review discharge applications.

Until now, whether to grant discharge for inspection results was determined ex officio during the disciplinary review adjustment or disciplinary review committee process without a separate application procedure from the financial companies or their executives and employees subject to discipline.

The FSS took this measure as a follow-up to the 'Comprehensive Reform of the Financial Sector Discharge System' plan announced jointly with the Financial Services Commission in April.

The Disciplinary Discharge Deliberation Committee is composed of 10 external experts from the legal and academic fields to ensure fairness in meeting operations and deliberations.

Private members include Lawyer Kim Hyo-yeon of Garam Law Firm, Professor Park So-jung of Seoul National University’s Business Administration Department, Lawyer Baek Ju-seon of Yungpyeong Law Firm, American lawyer Seo Moon-sik of Kim & Chang Law Office, Lawyer Shin Hyun-beom of Yulwoo Law Firm, Lawyer Yoon Hong-bae of Keunsup Law Office, Professor Jeong Ho-gyeong of Hanyang University Law School, Professor Choi Jun-hyuk of Inha University Law School, Lawyer Choi Jin-sook of Bareun Law Firm, and Professor Choi Cheol of Sookmyung Women’s University Consumer Economics Department.

Ex officio members include the FSS Deputy Director in charge of disciplinary review, the FSS legal advisor, and the FSS rights protection officer.

Each meeting is attended by six members: the Chairperson of the Disciplinary Discharge Deliberation Committee (FSS Deputy Director in charge of disciplinary review), the legal advisor (a current senior prosecutor), the rights protection officer, and three of the ten external private members designated for each meeting.

The Disciplinary Discharge Deliberation Committee deliberates whether the work performed by the financial company qualifies for discharge and whether intentional or gross negligence, which excludes discharge, applies.

Executives and employees of financial companies may apply for discharge during the FSS inspection period or during the period for submitting opinions on the prior notice of intended measures, asserting that the disciplinary matters planned by the inspection department qualify for discharge.

All discharge applications are submitted to the Disciplinary Discharge Deliberation Committee. Even without a discharge application, if the discharge eligibility is deemed unclear, the inspection department may request a deliberation ex officio.

The Disciplinary Discharge Deliberation Committee delivers the deliberation results to the Disciplinary Review Committee, which considers them when deliberating and resolving the discharge eligibility. However, the deliberation results of the Disciplinary Discharge Deliberation Committee are not binding.

The FSS stated, "We will humbly and thoroughly monitor whether there are any aspects to improve from the perspective of the financial market and the public during future operations, and promptly make improvements if any deficiencies are found."

This content was produced with the assistance of AI translation services.