Financial Supervisory Service (FSS) Chief Lee Chan-jin announced on July 29 at a National Assembly Finance Committee hearing that the FSS is preparing a preliminary investigation into allegations of personnel lobbying in the financial sector through Geonjin Beopsa, a Buddhist temple implicated in political lobbying. Lee's statement came in response to questions from Democratic Party lawmaker Jeon Hyun-hee, who cited media reports indicating that a special prosecutor investigation into Geonjin Beopsa has revealed evidence of interference in the appointment of major bank chairmen and senior executives. The allegations center on claims that personnel requests and lobbying occurred during appointment processes, with communication records and subsequent appointments of lobbied individuals suggesting possible connections. Lee acknowledged that while the FSS conducted inspections of financial holding companies lasting over 30 days, internal materials alone proved insufficient to verify the allegations, necessitating a broader preliminary investigation to establish factual grounds.
FSS Chief Acknowledges Investigation Challenges at National Assembly Hearing
Lee Chan-jin told the committee that the FSS is "mindful of the issues raised and preparing" for an investigation, but noted that "direct evidence collection has not been easy, so we are preparing to start with a preliminary investigation." Lawmaker Jeon Hyun-hee stated that if personnel lobbying and requests occurred during the appointment of major bank chairmen and executives, it would constitute "a serious matter that shakes confidence in the financial market." Jeon argued that communication records and messages could verify the allegations, and that if individuals who were the subject of lobbying were subsequently appointed, "considerable correlation can be inferred." She questioned whether the FSS could take action based on such circumstantial evidence alone, given the FSS's influence over the financial sector. Lee responded that "specific facts have not been confirmed" and that the FSS would proceed "once the facts are established."
Prior Financial Holding Company Inspections Failed to Confirm Lobbying Allegations
Lee explained that during inspections of financial holding companies, the FSS "conducted examinations for over 30 days and attempted to verify the relevant matters, but it was difficult to confirm them using only internal materials." He stated that current inspection methods have limitations in uncovering such allegations. Jeon pointed out that "the FSS must properly fulfill its role" and noted that similar issues appeared in the BNK Financial case, where "it seems circumstances or evidence were not found."
Lawmaker Calls for Anti-Lobbying Safeguards in Governance Reform Plans
Jeon emphasized that "since the President directed improvements to financial sector governance at the end of last year, the governance improvement measures to be prepared in the future must include safeguards to prevent the recurrence of Geonjin Beopsa-style lobbying." Lee responded that he would "keep this in mind."
FAQ
What did FSS Chief Lee Chan-jin announce on July 29?
FSS Chief Lee Chan-jin announced at a National Assembly Finance Committee hearing on July 29 that the FSS is preparing a preliminary investigation into allegations of personnel lobbying in the financial sector through Geonjin Beopsa. Lee stated that direct evidence collection has been difficult and that the FSS is starting with a preliminary investigation.
Why did the FSS conduct inspections of financial holding companies?
The FSS conducted inspections of financial holding companies lasting over 30 days to verify allegations of personnel lobbying and interference in executive appointments. Lee Chan-jin stated that these inspections could not confirm the allegations using only internal materials, indicating limitations in current inspection methods.
What safeguards did lawmaker Jeon Hyun-hee call for?
Lawmaker Jeon Hyun-hee called for the inclusion of safeguards in upcoming financial sector governance reform plans to prevent the recurrence of Geonjin Beopsa-style lobbying. She referenced the President's directive at the end of last year for improvements to financial sector governance and emphasized that anti-lobbying measures must be part of the reform plans.
