NH Nonghyup and Livestock Cooperatives Financial Scandal Exceeds 100 Billion Won... Recovery Rate Only 17%

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Over the past five years, a series of financial incidents such as embezzlement and fraud have occurred at NongHyup and Livestock Cooperatives, with the total amount involved exceeding 100 billion KRW. Among the types of incidents, cases of unauthorized access to personal information and violations of the real-name financial system were also included, drawing criticism for moral hazard.

On the 3rd, Yonhap News cited data received by People Power Party lawmaker Jeong Hee-yong, a member of the National Assembly's Agriculture, Forestry, Livestock, Food, and Maritime Affairs Committee, from the NongHyup Central Association, reporting that a total of 280 financial incidents occurred at NongHyup and Livestock Cooperatives from 2019 until last month. The total amount involved in these financial incidents was 111.9 billion KRW.

Looking at the annual amounts of financial incidents over the past five years, 2022 recorded the highest at 43.6 billion KRW, followed by 19 billion KRW last year. For this year, the amount involved in financial incidents up to last month was 7.5 billion KRW.

By type, embezzlement was the most frequent with 75 cases (27%), followed by private loans at 55 cases (20%), unauthorized access to personal information at 35 cases (13%), violations of the real-name financial system at 28 cases (10%), and fraud at 26 cases (9%).

By region, the financial incident amount was highest in Gyeongbuk at 31.2 billion KRW, followed by Gyeonggi at 27.2 billion KRW, Chungnam at 18.8 billion KRW, Jeonnam at 6.8 billion KRW, Gwangju at 5.7 billion KRW, Seoul at 5.1 billion KRW, and Gyeongnam at 5 billion KRW.

After the financial incidents occurred, the amount recovered by NongHyup and Livestock Cooperatives was only 17% of the total, amounting to 18.8 billion KRW. Daejeon and Busan recovered all the incident amounts, but Chungnam and Daegu had recovery rates of only 1% and 0%, respectively, effectively failing to recover the incident amounts.

In response, lawmaker Jeong stated, "The NongHyup Central Association should increase the recovery rate of financial incident amounts, which is currently only at 17%, and strengthen strict disciplinary measures and compensation responsibilities for those involved in embezzlement incidents." He added, "Considering recent embezzlement methods, detailed standards should be established to enhance the effectiveness of preventive measures, and comprehensive measures to eradicate financial incidents should be promoted."

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