'Receiving Subsidies Without Hiring'... 269 Cases of Employment Insurance Fraud Detected

Concerns are rising that the Employment Insurance Fund's finances may be depleted. On the 6th, the Seoul Employment Welfare Plus Center in Jung-gu, Seoul. Photo by Moon Honam munonam@

[Asia Economy Sejong=Reporter Kim Hyewon] The Ministry of Employment and Labor announced on the 14th that it uncovered 269 cases of fraudulent claims amounting to 2.57 billion KRW after conducting a planned investigation into unemployment insurance fraud over six months.

The Ministry ordered the return of 6.01 billion KRW, including additional recoveries. Among the detected fraudsters, 177 individuals who conspired in fraudulent activities or claimed large amounts were referred to the prosecution with recommendations for indictment to face criminal penalties.

The types of fraud detected in this planned investigation were categorized into broker involvement type, employer collusion type, and claimant solo type. The broker involvement type involves brokers establishing ghost companies and registering and deregistering 52 acquaintances as false insured persons to receive unemployment benefits, which are then shared among them, thereby embezzling unemployment benefits.

The employer collusion type involves employers fabricating the maintenance of employment for workers eligible for employment retention subsidies without actually maintaining their employment to fraudulently obtain subsidies. It also includes cases where workers and employers conspire to embezzle parental leave benefits even though the workers did not take parental leave.

The claimant solo type refers to cases where job seekers receiving unemployment benefits continue to receive them even after successfully finding employment without enrolling in employment insurance while working.

The Ministry of Employment and Labor is additionally investigating 196 more individuals, so the scale of detected fraud is expected to increase. This is the first planned investigation this year, and next year, 14 newly recruited employment insurance investigators will be assigned exclusively to strengthen investigative capabilities.

Kim Seongho, Director of Employment Policy at the Ministry of Employment and Labor, stated, "Employment insurance investigators nationwide are rigorously cracking down on unemployment insurance fraud through information linkage, planned investigations, special inspections, and joint investigations," adding, "It is only a matter of when they will be caught, but they will definitely be caught."