"Where Are You Throwing a Tantrum?" Swearing Echoes in the National Assembly Hearing... Top Textbook Publisher Cheonjae Education's 'Gapjil' Abuse

Transcript of Conversation Between Distributor and Genius Education Sales Staff Released at National Assembly's Political Affairs Committee Audit on the 16th

“Where are you throwing a tantrum? Damn it, where are you now, I said where the hell are you, damn it, wait for me, you XXX.”

On the 16th, at the National Assembly's Political Affairs Committee hearing, the sales representative of Cheonjae Education uttered these curses.

Yoon Chang-hyun, a member of the People Power Party, called Cheonjae Education CEO Kang Hee-cheol, the top company in market share for elementary, middle, and high school textbooks, and played a recorded phone conversation between a Cheonjae Education salesperson and a distributor (wholesaler).

Yoon Chang-hyun, a member of the People Power Party, is revealing a recording containing abusive language from a Cheonjae Education sales employee directed at distributors (wholesalers).
[Photo by National Assembly Broadcasting YouTube channel video capture]

Cheonjae Education, the number one company in market share for elementary, middle, and high school textbooks, is suspected of forcing sales quotas and limiting return quantities, thereby shifting inventory costs onto distributor branch managers. On this day, the Political Affairs Committee summoned CEO Kang Hee-cheol of Cheonjae Education as a witness to the hearing.

In the recording, the employee cursed after hearing the distributor's response, “Bring the (balance) confirmation letter,” to his question, “What are you talking about?” The balance confirmation letter is a document confirming that the unsold book costs are the distributor's debt.

Yoon explained that under the salesperson's coercion, the distributor branch manager stamped a high-value debt confirmation letter, and this conversation occurred when the distributor branch manager said he would review the confirmation letter again.

After playing the recording, Yoon asked CEO Kang, “Is this an employee or a gangster?” and added, “We have also confirmed that distributors are made to bear the cost of promotional materials. What do you think, CEO? Does this check out?”

Kang Hee-cheol, CEO of Cheonjae Education Photo by National Assembly Internet Broadcasting System

CEO Kang responded, “In the past, we supplied without limits, so there was a situation where unlimited returns occurred,” and “I understand that we supply at a low price.” Yoon then repeatedly asked, “I heard you had sales done through agencies; is that true?” and “Is it acceptable to have agencies handle textbook sales?”

He continued, “(Listening to the 2017 recording) only 20% of the ordered books can be returned, but 20% more books than the order quantity were sent to distributors. The distributors had to purchase this inventory themselves, incurring debt. Cheonjae Education even took collateral from distributors.”

He added, “According to the book sales transaction agreement between Cheonjae Education and distributors, there was a sales target clause until 2019. If the sales target was not met, the book supply price was raised, and contracts were terminated midway.”

CEO Kang replied, “Cheonjae Education basically operates on a made-to-order system. Because some textbooks have many editions, I understand that the ‘previous year’s sales volume’ is provided for convenience. If these parts are burdensome to distributors, we will provide them only if the distributors want. We will humbly review the pointed-out issues and strive to correct what can be corrected.”

Yoon asked Han Ki-jung, Chairman of the Fair Trade Commission, who was present at the hearing, “Some distributors were asked for 1,006.62 million won and 877.25 million won by Cheonjae Education. Distributors were even taken collateral. This issue was reported in 2019 as a violation of the Agency Act to the Fair Trade Commission but was closed during the review process due to lack of evidence. Considering the various aspects revealed today, it is clear that Cheonjae Education is shifting many costs onto distributors. Is this lack of evidence?”

Han Ki-jung, Chairman of the Fair Trade Commission, who was present at the hearing, said regarding the allegations against Cheonjae Education, “If a report is filed, we will investigate according to procedures. We will thoroughly ensure that such issues do not occur again.”

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