[2020 National Audit] KEPCO President's Overseas Contract Partner Shareholding Sparks Controversy at Audit (Comprehensive)

Siemens Included in 3.4 Billion Shares Held... KEPCO President "No Illegality"

[Image source=Yonhap News]

[Asia Economy Reporter Moon Chaeseok] On the 15th, it became a controversy at the National Assembly’s Industry, Trade, Energy, Small and Medium Business Committee’s audit that Kim Jong-gap, CEO of Korea Electric Power Corporation (KEPCO), held shares of Siemens, a German company where he previously served as CEO and Chairman.

Choi Seung-jae, a member of the People Power Party, stated, "Kim holds 1.1 billion KRW worth of Siemens shares, where he worked for seven years, and since becoming KEPCO CEO, contracts with Siemens have amounted to 7 billion KRW."

He added, "As a major shareholder of Siemens, it would not be disadvantageous if Siemens profits," and "In addition, together with his spouse, he invested in sectors related to KEPCO such as solar power, wind power, and electricity, resulting in a stock increase of 410 million KRW over one year."

Choi pointed out, "It seems he has successfully invested by well understanding overseas energy companies’ information," and "There is suspicion that a person with heavy responsibilities might have profited using insider information, raising questions about whether this behavior is appropriate."

According to data titled 'Stock Holdings and Transactions of Ministry of Industry and Affiliated Institution Executives' received by Rep. Lee Joo-hwan’s office from the Ministry of Trade, Industry and Energy, Kim holds a total of approximately 3.43499 billion KRW in stocks, including 2.12522 billion KRW held personally and 1.30973 billion KRW held by his spouse.

The holdings include 191,000 shares of Brazilian government bonds (BNTNF), 7,339 shares of Siemens, where he served as CEO and Chairman, and 39,200 shares of Chinese solar power company Xinyi Solar Holdings.

Additionally, he holds stocks across various sectors such as U.S. oil fund, online shopping malls, fashion groups, biotechnology, wind turbine companies, and funeral service companies.

Although Kim holds stocks related to his duties, the amounts are below 30 million KRW, so under the Public Officials Ethics Act, holding them itself is not problematic. Stocks managed through wrap accounts (integrated asset management services) are also below 30 million KRW per stock and are not subject to duty-related scrutiny.

Choi emphasized, "Many of the stocks Kim holds are overseas stocks, and while not violating the Public Officials Ethics Act, they should be sold or placed in blind trusts to meet public expectations."

In response, Kim strongly denied, saying, "This is slander. There is suspicion that I bought Siemens shares by exploiting my position as KEPCO CEO, but please raise issues after clearly understanding the facts."

Kim explained, "I have not purchased additional Siemens shares since assuming the KEPCO CEO position, and part of the bonus that was granted four years ago has been scheduled to be received from the year before last until next year," and added, "I accept the criticism to have ethical awareness, but I do not know how to behave in areas that are not legally violating currently."

According to Rep. Lee Joo-hwan’s office, among executives of the Ministry of Industry and its affiliated institutions, 30 executives including Kim hold stocks, with a total stock value of approximately 4.96 billion KRW.

Yoon Euisik, Standing Auditor of Korea National Oil Corporation, held 581.9 million KRW; Son Juseok, Director of Korea Petroleum Management Service, 273.2 million KRW; Lee Kyung-sil, Vice President of Korea District Heating Corporation, 177.32 million KRW; and Lee Cheong-ryong, Chairman of Korea Mine Reclamation Corporation, 125.35 million KRW, in descending order.

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