Board of Audit and Inspection Publishes Audit Report on 'Support Status of Non-Profit Private Organizations'
10 Cases Detected, 1.8 Billion KRW Misused... 73 People Including Representatives Referred for Investigation
Civil organizations that embezzled subsidies related to the 'Community Recovery Program' conducted under the Sewol Ferry Victim Support Act have been caught. They inappropriately spent subsidies on instructor fees and video lecture material production or used them for purposes unrelated to the subsidy content.
On the 17th, the Board of Audit and Inspection disclosed the results of an audit on the 'Support Status of Non-Profit Private Organizations' conducted from August last year to February this year. Following a mid-term announcement of this content in May and a resolution by the Audit Committee, 10 non-profit private organizations that embezzled national subsidies from the government and local governments were identified.
The audit targets included about 900 private organizations supported by six ministries closely related to non-profit private organizations and their work?namely the Ministry of the Interior and Safety, Ministry of Unification, Ministry of Foreign Affairs, Ministry of Culture, Sports and Tourism, Ministry of Environment, and Ministry of Gender Equality and Family?as well as Seoul City and relevant ministries and agencies. Among these, organizations with large amounts of national subsidies were the focus of the investigation.
The total amount of fraudulent use of national subsidies confirmed by the Board of Audit and Inspection for the 10 organizations was 1.808 billion KRW, with approximately 1.74 billion KRW corresponding to cases referred for investigation. A total of 46 confirmed illegal and improper cases were reported to the National Police Agency, involving 73 people including representatives of the organizations, on charges of embezzlement, fraud, and violation of the Subsidy Act.
According to the audit results, one organization was found to have embezzled national subsidies by falsely paying expenses or labor costs and then receiving them back, or by entering into false contracts.
In a cultural project support organization, the head of headquarters colluded with accounting staff to embezzle 1.057 billion KRW in subsidies. The embezzled money was used for funding their children's business, purchasing a horse for their granddaughter, and supporting study abroad expenses. Other cases included embezzlement through false contracts with companies operated by their own family or fabricating that already released products were newly developed.
Additionally, the chairman of a certain organization supported by the Ministry of Gender Equality and Family for the UNESCO registration project of records of comfort women victims received wages for more than half of 100 working days without actually working and manipulated records to appear as if they worked during foreign trips, embezzling labor costs amounting to 6.7 million KRW.
Earlier, the Board of Audit and Inspection launched a focused inspection from August last year to February this year following political criticism regarding the fraudulent use of national subsidies by non-profit private organizations. Regarding this audit result, the Board ordered related ministries such as the Ministry of Culture, Sports and Tourism and the Ministry of Gender Equality and Family to cancel or reclaim subsidies and prepare improvement measures.
The Board of Audit and Inspection stated, "Due to heightened public interest caused by recent accounting fraud cases in some organizations, we conducted a specific audit to check the government's support status for non-profit private organizations," adding, "We intend to strictly punish misconduct and sound an alarm against the behavior of regarding government subsidies as free money."
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