NACF"s Serious Financial Mismanagement

The National Agricultural Cooperative Federation(NACF), or Nonghyup, is in serious financial difficulties approaching complete insolvency.
The Board of Audit and Inspection(BOAI) announced on Feburuary 25 that about half of the 1,332 membership associations of the NACF are suffering huge losses.
The NACF's losses stem from abandoning lending policies, which went unchecked because of practices of creative accounting.
Loans were given at favorable rates to poor credit risks for dubious reasons. Allegations of bribery and kickbacks are being investigated.
Numerous membership associations regularly reported surpluses when in fact they were incurring staggering losses. The system allowed employees who took early retirement to be paid 2.3 times the amount that employees of private companies received if they retired in 1997.
The BOAI called for the Ministry of Agriculture and Forestry to punish 165 employees of the NACF and its membership associations.