Joo Byungki, Chairman of the Fair Trade Commission, is reporting the results of the wheat flour cartel investigation and response measures at the Special Ministerial Task Force (TF) on Livelihood Prices and the 268th Foreign Economic Ministers' Meeting held at the Government Seoul Office in Jongno-gu, Seoul on the 21st. Photo by Yonhap News Agency

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At a Cabinet meeting in February, President Lee stated, "If someone reports collusion, give them a reward that will change their life and fate. Make it so big and impactful that people would rather dig up collusion than play the lottery." He strongly advocated for the necessity of a high-value reward system. At that time, he remarked, "If the penalty is 400 billion won, it's fine to give even several tens of billions of won as a reward." In March, he reiterated, "If someone inflicts damage through collusion, unfair practices, or abuse of market dominance, and faces a massive penalty, and if 10% of that penalty is given as a reward, there will be no way to stop whistleblowers." He even presented specific guidelines, including the incentive ratio.

President Lee Jae-myung speaking at the Chief Senior Secretary Meeting on the 14th. Photo by Yonhap News Agency

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Accordingly, the reward payment standards that the Fair Trade Commission will soon release are also likely to be based on the "10% of the relevant penalty" guideline mentioned by the President. In the case of large-scale collusion cases, the penalties imposed on companies can reach several hundred billion won, meaning that in the future, there may be whistleblowers who receive literally "tens of billions of won" as a reward. Additionally, under the new plan, subcontractors, franchisees, and suppliers who were previously excluded from receiving rewards if they were direct victims, will now be eligible.

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This high-value reward approach has also been incorporated into measures to stabilize the cost of living. According to the "Measures to Enhance the Effectiveness of Price Stabilization," announced jointly by relevant ministries on May 21, the government will introduce a new whistleblower reward system that provides rewards based on the level of contribution for those who report violations such as exceeding maximum price limits, emergency supply adjustment orders, or hoarding. Kang Giryong, Assistant Vice Minister of the Ministry of Economy and Finance, stated, "The direction is clear: to provide incentives strong enough to root out such violations."

These policy changes are rapidly spreading throughout government ministries. In February, the Financial Services Commission abolished the cap on rewards for those who report stock price manipulation or accounting fraud, and announced revisions to enforcement ordinances of the Capital Markets Act and the External Audit Act, as well as subordinate regulations, to allow rewards of up to 30% of the recovered illegal gains or penalties. Previously, there was a cap of 3 billion won (for unfair trading).

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Other ministries are also enhancing policy effectiveness through large reward systems. In March, the Ministry of Planning and Budget announced the "Measures to Eradicate Fraudulent Use of National Subsidies," which will provide up to 30% of the recovered amount as a whistleblower reward—without any cap. This expanded on the previous standard, which was "up to 30% of the refunded amount within the budget limit." The National Tax Service currently operates a whistleblower reward scheme for tax evasion reports with a maximum payout limit of 4 billion won. The National Health Insurance Service also raised the cap for rewards related to false or fraudulent claims from 2 billion won to 3 billion won as of December last year, indicating that public institutions are also joining this trend.

Some have raised concerns that if rewards amounting to tens or hundreds of billions of won are paid out, ministry budgets could be exhausted and the system could be undermined. However, with the financial authorities loosening restrictions, such concerns are expected to be alleviated. The Ministry of Planning and Budget has recently decided to establish a "Public Interest Whistleblower Incentive Fund" to stably support inter-ministerial public interest reporting and reward payments. A special law will be drafted this month, and the enactment will be pursued in August following National Assembly deliberation. After the fund is established, whistleblower rewards from the Financial Services Commission, Fair Trade Commission, and others will be paid through this fund.

Cho Yongbeom, Head of Budget at the Ministry of Planning and Budget, said, "Public interest reporting is an important institutional mechanism that supplements the state's capacity to monitor anti-social acts," and added, "With the establishment of the Public Interest Whistleblower Incentive Fund, we will better support internal and public reporting of anti-social acts such as unfair trading, capital market violations, and fraudulent subsidy claims."