46 People Accused of Embezzling National Subsidies for Solar Power Projects Face Mass Trial

A total of 46 contractors and business operators have been collectively brought to trial on charges of embezzling government-supported loans related to solar power generation projects.

The Anti-Corruption Investigation Division of Daegu District Prosecutors' Office (Chief Prosecutor Gong Jun-hyeok) announced on the 4th that it has indicted without detention a total of 46 individuals, including 15 solar power contractors and 31 power generation business operators, on charges of violating the Act on the Aggravated Punishment of Specific Economic Crimes for embezzling government funds by obtaining fraudulent loans worth approximately 10 billion KRW.

Solar panels installed on the rooftop in Dong-gu, Daegu (not directly related to the article content)

Since 2017, the government has provided long-term, low-interest policy fund loans with a grace period of 5 years and an annual interest rate in the 1% range through the renewable energy financial support project to expand solar power facilities and others, utilizing the Electricity Industry Infrastructure Fund. However, some contractors exploited this by promoting that they would carry out construction solely with loans without any self-financing, securing numerous solar power construction contracts. Additionally, power generation business operators installed expensive solar power equipment without self-financing through fraudulent loans and sold the electricity produced back to the state, reportedly earning profits amounting to 20% annually relative to the loan amount.

This investigation began around August last year when the Office for Government Policy Coordination requested the Supreme Prosecutors' Office to investigate suspected loan fraud by solar power contractors. From October to December last year, the Daegu District Prosecutors' Office conducted search and seizure operations at the Korea Energy Agency, the National Tax Service, financial institutions, and contractors' offices, and interrogated related individuals.

Among the power generation business operators involved in the crime, some included public officials, public institution employees, and local agricultural cooperative executives who built and operated power plants under borrowed names despite not being eligible for loan support. There were also cases where multiple solar power plants were established under several people's names to generate higher profits.

A prosecutor stated, "Through the investigation, we uncovered the full scope of a national finance crime where solar power business operators received low-interest loans without capital and gained profits equivalent to ten times the loan interest, resulting in the improper use of national finances for individual profit generation. We will promptly recover criminal proceeds according to relevant laws and continue to strictly respond to national finance crimes that deplete government funds through unfair means."

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