Another 10 Billion Won Embezzlement Incident at NongHyup Bank... Involved Employee Found Dead

Unauthorized Loan Fraud Using Acquaintance's Name
4th Incident This Year at NongHyup Bank Alone

Another embezzlement incident involving 10 billion KRW has occurred at NH Nonghyup Bank. The employee involved in the incident was found dead. As this marks the fourth embezzlement case at Nonghyup Bank this year, calls are growing to thoroughly review the internal control system and organizational culture.

According to the financial sector on the 23rd, Nonghyup Bank recently discovered improper loan transactions with possible embezzlement at a branch in downtown Seoul and began an audit on the 20th. Assistant Manager A, an employee at the Myeongdong branch, is reported to have used a friend's name to obtain false loans from June 2020 until this month.

The amount embezzled identified by Nonghyup Bank so far is approximately 11.7 billion KRW. The bank stated, "Depending on the audit results, we will take the highest level of disciplinary action and legal measures such as criminal charges against those involved as soon as any violations are found."

Assistant Manager A, involved in the incident, initially refused to cooperate with the internal audit and was found dead in a car in Jongno-gu, Seoul, on the 21st. A representative from the Jongno Police Station said, "A suspicious death case has been reported and is under investigation," adding, "We cannot disclose further information as it is personal."

This incident raises the number of financial accidents at Nonghyup Bank to four this year. In March, an employee at one branch was caught on charges of breach of trust related to real estate collateral loans, and two similar financial accidents were uncovered through internal audits in May.

Not only at Nonghyup Bank but also at Woori Bank, incidents such as improper loans involving relatives of former Woori Financial Group Chairman Sohn Tae-seung have surfaced, prompting calls within and outside the financial sector for a thorough review of banks' internal control systems and organizational cultures.

Lee Bok-hyun, Governor of the Financial Supervisory Service, also held a meeting with bank presidents in June, stating, "There are increasing criticisms of employees' moral insensitivity and lax internal controls due to continuous financial accidents in the banking sector," and emphasized, "To prevent recurrence of financial accidents such as embezzlement, loan inflation (breach of trust), and incomplete sales, banks' ethical awareness must fundamentally change at the organizational culture level."