This Year’s Embezzlement in the Financial Sector Reaches 60 Billion Won... Second Largest Ever

'Woori Bank Employee Embezzlement' 101 Billion Last Year Followed by
33 Cases Until July This Year, Including 11 Companies Such as Gyeongnam Bank

As a new embezzlement case involving 56 billion KRW at Gyeongnam Bank has come to light, it has been revealed that the total embezzlement amount in domestic financial companies this year has reached 60 billion KRW, the second largest ever.

According to data submitted by the Financial Supervisory Service to Yang Jeong-suk, a member of the National Assembly's Political Affairs Committee from the Democratic Party of Korea, as of July this year, there have been a total of 33 embezzlement cases involving employees of financial companies, occurring in 11 companies including Gyeongnam Bank. The total embezzled amount was 59.273 billion KRW, making it the second highest after last year’s 101 billion KRW, which included the Woori Bank embezzlement case involving 70 billion KRW.

In terms of embezzlement scale, Gyeongnam Bank, where the recent 56.2 billion KRW real estate project financing (PF) loan embezzlement incident was uncovered, had the largest amount. It is also known that Gyeongnam Bank had one more minor embezzlement case under 1 million KRW this year besides this incident.

Shinhan Bank followed Gyeongnam Bank with an embezzlement amount of 717 million KRW as of July this year, followed by Nonghyup Cooperative (613 million KRW), Credit Union Cooperative (439 million KRW), Industrial Bank of Korea (322 million KRW), OK Savings Bank (251 million KRW), KB Kookmin Bank (223 million KRW), NH Nonghyup Bank (185 million KRW), Koreate Asset Management (160 million KRW), Woori Bank (91 million KRW), and Hana Bank (72 million KRW).

The embezzlement amounts by employees of domestic financial companies were 14.475 billion KRW in 2017, 11.284 billion KRW in 2018, 13.163 billion KRW in 2019, and 17.738 billion KRW in 2020, then decreased to 3.48 billion KRW in 2021, but surged to a record high of 101.072 billion KRW last year due to the Woori Bank employee embezzlement case.

Although financial authorities ordered financial companies to strengthen internal controls following last year’s Woori Bank embezzlement incident, embezzlement cases have not subsided. It was confirmed that the Gyeongnam Bank employee involved in the recent embezzlement had been performing similar tasks for a long time, revealing that internal control innovation measures such as rotating long-term employees have not been properly implemented.

The Financial Supervisory Service announced that it will investigate the status of rotating long-term employees and the operation of mandatory leave systems at banks and other financial companies. It also plans to check whether the separation of sales and fund transfer tasks has been implemented for high-risk PF loans, and whether measures to prevent forgery and alteration of designated account transfer systems and fund withdrawal requests have been properly carried out.

A real estate project financing loan embezzlement incident involving approximately 56 billion KRW occurred at BNK Gyeongnam Bank. The photo shows a BNK Gyeongnam Bank branch in downtown Seoul on the 3rd. Photo by Jinhyung Kang aymsdream@

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