Woori, Hana, Kookmin Bank Employees Embezzle 153.6 Billion Won... Only 7% Recovered

Woori Bank Embezzlement Scandal Totals 73.5 Billion KRW Since 2018
Repeated Financial Incidents Despite Regulatory Measures
"Need for Effective Internal Controls and Audit Systems"

Despite strengthened internal controls within the financial sector, embezzlement incidents continue to occur in the banking industry.

According to data submitted by the Financial Supervisory Service to Assemblyman Yoo Dong-su of the National Assembly's Political Affairs Committee on the 4th, the total amount embezzled by employees of 15 domestic banks from 2018 to July of this year reached 153.6 billion KRW.

Although financial authorities have continuously issued directives to reinforce internal control measures within the financial sector, these incidents have not been eradicated. In 2018, the authorities announced an innovation plan for internal controls in financial institutions, followed by a similar plan for domestic banks in 2022.

Looking at embezzlement cases by bank, from 2018 to July this year, Woori Bank recorded the highest embezzlement amount at 73.5 billion KRW (13 cases), followed by Kyongnam Bank with 59.6 billion KRW (4 cases), Hana Bank with 6.5 billion KRW (24 cases), Industrial Bank of Korea with 3.2 billion KRW (14 cases), and NongHyup Bank with 3.1 billion KRW (19 cases).

On the other hand, the recovery rate of embezzled funds was low. From 2018 to June this year, the amount recovered from embezzlement in the banking sector was only 6.9%, or 10.6 billion KRW. This means that 145 billion KRW remains unrecovered. Additionally, Woori Bank, which had the highest embezzlement amount, showed the lowest recovery rate in the banking sector, with only 1 billion KRW (1.5%) recovered.

Assemblyman Yoo Dong-su pointed out, "Despite the introduction of internal control measures by financial authorities, financial accidents continue unabated," adding, "The financial authorities' inadequate measures, the porous internal control management within the financial sector, and lenient punishments for executives are exacerbating financial accidents."

He continued, "Employee embezzlement incidents, which destroy the fundamental trust of banks, undermine confidence in the financial industry," emphasizing, "A responsibility structure that can hold even the highest executives accountable for major incidents should be introduced early, along with ethics education for employees and whistleblower protection systems, to prevent financial accidents."