FSS Chief: "Strengthening Financial Consumer Protection Is the Most Urgent Task"

Lee Chanjin, Governor of the Financial Supervisory Service. Photo by Kang Jinhyung

원본보기 아이콘

Lee Chanjin, Governor of the Financial Supervisory Service, reiterated that strengthening financial consumer protection is the most urgent task facing the financial sector.

On the afternoon of September 9, at the Financial Supervisory Service in Yeouido, Seoul, Governor Lee hosted a meeting on financial consumer protection governance with the CEOs of 19 major domestic financial companies. He stated, "The new administration is pursuing financial consumer protection as a core task," and added, "The Financial Supervisory Service is also fundamentally shifting its work philosophy and approach to focus on consumer protection."

He pointed out, "As revealed in the recent Hong Kong ELS (Equity-Linked Securities) incident, some parts of the industry still exhibit unhealthy management practices centered on short-term results and inadequate internal controls." He argued, "Due to these chronic issues, consumer harm continues to recur, and substantial consumer-centered operations remain insufficient, making improvements necessary."

He went on to say, "We must dramatically strengthen financial consumer protection governance and establish a management culture centered on consumer protection. Rather than responding after the fact, it is essential to build a preemptive prevention system to avert incidents in advance, with consumer protection governance at its core." He added, "If consumer protection governance is significantly strengthened, risks will decrease and trust will increase, leading to stable growth and profit for financial companies."

He also urged faithful implementation of best practices for consumer protection governance and active involvement from top management. On this day, the Financial Supervisory Service called on financial companies to adopt best practices, including the effective operation of internal consumer protection committees, ensuring the independence and expertise of Chief Consumer Officers (CCOs) and consumer protection departments, designing and evaluating performance-based compensation systems (KPIs) focused on consumer protection, and clarifying the role of holding companies in consumer protection.

Governor Lee remarked, "Financial companies have fallen short of expectations in implementing effective internal controls for consumer protection, due to limited interest from top management and profit-oriented management." He continued, "I urge CEOs and boards of directors to take an active role so that a consumer protection-centered organizational culture can take root through best practices."

He also requested that financial companies make efforts to ensure that consumers receive prompt and fair protection regarding public complaints and disputes. "Due to business competition among financial companies, the number of complaints and disputes filed with the Financial Supervisory Service has been increasing every year," he said. "Although the Financial Supervisory Service is devoting substantial resources and preparing various measures to handle the growing number of complaints, there are limits to what the supervisory authority can do alone." He called for greater efforts in prevention.

He further emphasized, "We must strengthen our ability to respond to financial crimes that threaten people's livelihoods, such as voice phishing." He urged, "Please thoroughly establish preemptive systems to quickly detect and block crimes affecting daily life, such as upgrading abnormal transaction detection systems and enhancing voice phishing screening."

© The Asia Business Daily(www.asiae.co.kr). All rights reserved.