The Financial Supervisory Service's First Digital & IT Division... Full Effort to Prevent Timaep Recurrence and Supervise Coins

Promotion to Headquarters Level... Evidence of Expanding Influence in Electronic Finance
First Division Head is a 'Veteran' Director from a Credit Rating Agency
Immediate Challenge is Handling the Timef Incident... Virtual Assets Also a Major Focus

Jong-oh Lee, Deputy Director of Digital and IT Division at the Financial Supervisory Service. Photo by Financial Supervisory Service

The Financial Supervisory Service (FSS) has, for the first time, elevated the digital and information technology (IT) sector to an independent division and appointed data expert Lee Jong-oh, a former credit rating agency professional, as the inaugural executive. Although last year's 'T-mep (Timon·Wemakeprice) incident' was a direct trigger, this move also signifies the rising status of future financial industries such as e-commerce and virtual assets, which fall outside the traditional finance category.

According to financial authorities on the 6th, the FSS carried out personnel changes and organizational restructuring in December last year for the '2025 personnel plan,' separating the previously scattered digital and IT teams to establish a dedicated headquarters. The head of this division was also promoted to an executive position (Deputy Director). The dedicated electronic finance teams for PG and prepaid services were expanded from two teams to two departments, increasing the total number of departments within the organization from 64 to 65. This is expected to be the final personnel move by FSS Governor Lee Bok-hyun, whose term expires in June this year.

One of the immediate tasks for the digital and IT division this year is resolving the T-mep incident and preventing similar incidents in the industry. The FSS revealed in an investigation last August that the unsettled amount due to the T-mep incident reached 1.3 trillion KRW, affecting 48,000 victim companies. The FSS faced social criticism for its lax management and supervision of the e-commerce sector.

Another major focus is the supervision and inspection of virtual assets. The Virtual Asset Supervision and Inspection Bureau, newly established in line with the enforcement of the 'Virtual Asset User Protection Act' in July last year, was separated from the existing Strategic Supervision Division and reassigned to the Digital and IT Division. Currently, virtual asset-related work focuses on detecting unfair trading, but active discussions are underway regarding a second-stage law with the nature of a sector-specific law. The development of related markets and industries is also expected to become an important task for the authorities. The Financial Services Commission (FSC), the higher authority of the FSS, is also continuing open discussions on whether to allow corporate investment in virtual assets and the regulation of related products. Lee Jong-oh, Deputy Director, attends the FSC's Virtual Asset Committee, which was also attended by the Strategic Planning Deputy Director.

Lee Jong-oh, appointed as the first head of the Digital and IT Division, was born in 1970 and is a data expert with a background in credit rating agencies. He graduated from Chungju High School, earned a bachelor's degree in Business Administration from Yonsei University, and a master's degree in Business Administration from Seoul National University. He joined the FSS in 2006 and has since worked in various departments including Non-bank Inspection Division 2, Credit Specialized Services Office, Special Bank Inspection Division, Mutual Credit Supervision Division, General Supervision Division, Credit Supervision Division, Savings Bank Supervision Division, Credit Finance Inspection Division, and Credit Finance Supervision Division. He was promoted to Deputy Director in 2022, serving as Deputy Director of the Credit Supervision Division, and was appointed Director of the Credit Finance Supervision Division in August of the same year. In January last year, he was appointed Director of the Small and Medium Finance Supervision Division, a senior division in the SME finance sector.

A senior FSS official hinted, "After the Dongyang Group incident, there was an opinion that flexible thinking from the private sector was needed, so Deputy Director Lee Jong-oh joined and was dispatched for work," adding, "He is a capable figure." The Dongyang Group incident was a major financial scandal in 2013 where Dongyang Group concealed its risk of bankruptcy and sold commercial papers incompletely, causing damage amounting to 1.7 trillion KRW to about 40,000 people.

The FSS appointed senior department head Wi Choong-ki as the director of the senior Digital Finance General Division. Department heads Yoo Hee-jun (IT Inspection Bureau), Byun Jae-eun (Electronic Finance Supervision Bureau), Shim Eun-seop (Electronic Finance Inspection Bureau), Jeon Hong-gyun (Virtual Asset Investigation Bureau), and Lee Sung-wook (Information Strategy Bureau) were newly promoted from team leaders to directors. The FSS explained that experienced career and open recruitment promotions with extensive IT field experience were appointed to the IT Inspection Bureau and Information Strategy Bureau. Director Lee Seok, who previously served as head of the Accounting Supervision Bureau, was also transferred to the Virtual Asset Supervision Bureau in recognition of his accounting expertise.

Another FSS official said, "IT was not mainstream at the supervisory agency, but it seems very meaningful that a new headquarters was created in line with the times, including financial companies," adding, "Last year's incident was probably a trigger, and along with systematic changes, there seems to be a historical mission to achieve digital transformation as one pillar."

The FSS's stance on strengthening digital finance supervision has also attracted attention from the accounting and legal sectors. The Future Finance Strategy Center of the law firm Bae, Kim & Lee said, "It is expected that the supervisory and inspection activities of financial supervisory authorities over financial companies, including digital finance operators, will be strengthened in the future."