418 Billion KRW Recovered for 'Subsidy Fraud' in First Half of This Year... 20 Billion KRW in Penalties Imposed

It has been revealed that the amount recovered by public institutions for fraudulent subsidy claims in the first half of this year exceeded 40 billion won.

Anti-Corruption and Civil Rights Commission. / Photo by Hyunmin Kim kimhyun81@

On the 6th, the Anti-Corruption and Civil Rights Commission (ACRC) announced the results of an inspection on the implementation of sanctions, including recovery, under the "Act on Prohibition of Fraudulent Claims on Public Funds and Recovery of Unjust Benefits" for 308 institutions, including central administrative agencies, local governments, and city/provincial education offices, at a briefing held at the Government Seoul Office in Jongno-gu, Seoul.

According to the inspection results, in the first half of this year, 308 public institutions recovered a total of 41.8 billion won due to fraudulent claims and imposed 20 billion won in additional penalties, which is a 22.4% increase compared to the total recovery and penalty amount of 50.5 billion won in the first half of last year.

The increase compared to the first half of last year was confirmed to be due to a rise in penalty amounts in cases such as the misuse of project funds for private purposes in large-scale research and development (R&D) projects, and embezzlement of labor costs through disguised employment in support projects aimed at job creation.

Looking at the sanctions by sector, the 'social welfare' sector, which disburses the largest amount of public funds, saw the highest sanctions with 34.2 billion won recovered (82%) and 13.7 billion won in additional penalties (69%).

By institution type, local governments, which are on the front lines of disbursing various public funds, accounted for the largest recovery amount of 26.2 billion won (63%), while central administrative agencies, which implement large-scale policy projects, imposed the highest additional penalties of 19.2 billion won (96%).

Based on the results of this inspection, the ACRC plans to conduct additional checks on cases where recovery was not made despite fraudulent claims, cases where additional penalties were not imposed, and cases where the types of fraudulent claims were misclassified, and will recommend proper enforcement of sanctions.

Jung Seung-yoon, Vice Chairman and Secretary General of the ACRC, stated, "We will enhance the effectiveness of the public fund recovery system by establishing an organic cooperation system that jointly investigates vulnerable areas of fraudulent claims with related agencies and strengthening continuous inspection functions to prevent leakage of public funds and suppress fraudulent claims."