Saemaeul Geumgo, Acting Vice Chairman System... "Ensuring No Management Gap" (Comprehensive)

Non-Detention Indictment Against Park Cha-hoon, President of Saemaeul Geumgo Central Association, Suspended from Duty
Kim In Serves as Acting Vice President

Park Cha-hoon, President of the National Credit Union Federation of Korea
[Photo by Yonhap News]

With Park Cha-hoon, Chairman of the Saemaeul Geumgo Central Association, being indicted on charges of receiving bribes from asset management company representatives, the Saemaeul Geumgo Central Association will be operated under the acting leadership of Vice Chairman Kim In.

On the 24th, the Ministry of the Interior and Safety announced, "Following Chairman Park's indictment, the duties of the Chairman of the Saemaeul Geumgo Central Association have been immediately suspended pursuant to Article 79-4 of the Saemaeul Geumgo Act." The duties of Ryu Hyuk, CEO of the Credit Guarantee Corporation, who was also brought to trial on charges including bribery under the Act on the Aggravated Punishment of Specific Economic Crimes along with Chairman Park, were also immediately suspended. In the event of the chairman’s suspension, according to the regulations on the acting duties of the Saemaeul Geumgo chairman, Vice Chairman Kim, who currently serves as the chairman of Namdaemun Chungmuro Saemaeul Geumgo, will assume the acting duties.

Saemaeul Geumgo has been facing adverse conditions, compounded by a recent bank run (massive withdrawal of deposits) crisis and now the judicial risks surrounding Chairman Park. Amid these ongoing challenges, the Saemaeul Geumgo Central Association established the ‘Saemaeul Geumgo Management Innovation Committee’ on the 18th, composed of external experts and Saemaeul Geumgo directors, to enhance management innovation.

Regarding this, the Ministry of the Interior and Safety stated, "Together with the Saemaeul Geumgo Management Innovation Committee, we will prepare and implement rigorous governance reforms, transparent management of the Geumgo, and strong supervision and guidance of both the Central Association and the Geumgo, making every effort to restore public trust through thorough innovation measures."

The Saemaeul Geumgo Central Association also expressed in a statement on the same day, "We apologize for causing concern to our customers" and explained, "We are taking every measure to ensure that no management gaps occur." They further emphasized, "The indictment of individuals within the Saemaeul Geumgo Central Association and its employees is a separate matter from management stability, and there is absolutely no disruption to the operation of the 1,291 Saemaeul Geumgo branches nationwide." According to the Central Association, since the 10th of last month, a government-wide Saemaeul Geumgo task force has been stationed to manage the management status of both the Central Association and individual Geumgo branches.

The Saemaeul Geumgo Central Association added, "To strengthen practical supervisory functions and secure management transparency, we will closely cooperate with government authorities such as the Ministry of the Interior and Safety, and actively implement more rigorous innovation plans developed by the Management Innovation Committee."

Meanwhile, the Seoul Eastern District Prosecutors’ Office Criminal Division 5 (Chief Prosecutor Kim Hae-kyung) and Criminal Division 6 (Chief Prosecutor Seo Hyun-wook) announced on the same day that Chairman Park was indicted without detention on charges of violating the Act on the Aggravated Punishment of Specific Economic Crimes (including bribery). The prosecution alleges that from March 2021 to April this year, Chairman Park received 100 million KRW in cash and had 50 million KRW in legal fees paid on his behalf by the CEO of an asset management company that attracted investment funds from the Saemaeul Geumgo Central Association. Chairman Park is also accused of receiving 78 million KRW in cash and 22 million KRW in legal fees from three full-time directors of the Saemaeul Geumgo Central Association under the pretext of organizational management expenses, as well as two gold seals worth approximately 8 million KRW from a subsidiary CEO as a bribe for appointment.

Additionally, the prosecution indicted a total of 12 Saemaeul Geumgo employees, including executives and regional Geumgo chairpersons (five detained). They are accused of receiving bribes in exchange for loans or fund investments or providing illegal benefits to Chairman Park. Furthermore, eight employees (two detained) of securities firms, banks, and capital companies who received bribes for loan brokerage, eleven loan brokers (four detained), and ten operators of asset management and real estate development companies who provided bribes to financial company employees were also brought to trial.

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