Supreme Court Begins Disciplinary Action on 'Overpriced Furniture Purchases'... Prosecution Launches Investigation

Board of Audit and Inspection: "Office Furniture Procured by Private Contract Without Verifying 'Market Price'... Budget Waste"
Prosecutors Receive Board of Audit Complaint... Seoul Central District Prosecutors' Anti-Corruption and Strong Investigation Division 1 Assigned

[Asia Economy Reporter Heo Kyung-jun] After the Board of Audit and Inspection revealed that the Court Administration Office and various courts wasted budget by paying premiums when purchasing office furniture, the Supreme Court has initiated disciplinary procedures against those involved.

According to the legal community on the 15th, the Board of Audit and Inspection stated in the Supreme Court’s regular audit report released on the 24th of last month that the Court Administration Office and 11 courts at various levels wasted budget by entering into private contracts based on quoted prices higher than the market price without verifying the transaction reference price when purchasing office furniture from 2018 to 2020.

The furniture suppliers were three companies, including Company A, which has been supplying furniture to the courts since 1981, and companies operated by relatives of Company A’s representative.

The Board of Audit and Inspection found that the Court Administration Office and others entered into 184 private contracts (contract amount approximately 753 million KRW) from 2018 to 2020 without properly verifying prices, resulting in an estimated budget waste of about 255 million KRW.

Additionally, the Board of Audit and Inspection revealed that the Court Administration Office and 12 institutions under the Supreme Court, including the Seoul Central District Court, signed private contracts worth about 3.1 billion KRW with vendors who do not have production facilities and therefore cannot manufacture furniture themselves. According to current laws, when procuring SME competitive products with an estimated price of 10 million KRW or more through private contracts, it is mandatory to verify whether the products are directly produced.

Furthermore, the Board of Audit and Inspection confirmed a total of 32 illegal or improper cases, including instances where furniture companies deceived the courts by falsely labeling products as meeting safety standards when they did not.

The Supreme Court’s Ethics Audit Office recently began disciplinary procedures against those responsible for purchasing office furniture. On the 13th, the Supreme Court also sent an official letter to accounting officers at courts nationwide, highlighting precautions related to budget execution and contracts based on the Board of Audit and Inspection’s findings.

A representative of the Court Administration Office stated, "Disciplinary procedures against those involved are underway following the Board of Audit and Inspection’s audit results. The Court Administration Office is currently preparing and implementing comprehensive measures to prevent recurrence and is carefully reviewing whether additional measures are necessary based on this audit."

The prosecution has also launched an investigation into this matter. The Anti-Corruption and Violent Crime Investigation Division 1 of the Seoul Central District Prosecutors’ Office (Chief Prosecutor Jeong Yong-hwan) received a complaint from the Board of Audit and Inspection in April and is currently investigating.

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