[EDITORIALS]Thin skins at credit unions

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[EDITORIALS]Thin skins at credit unions

It is deplorable that a recent newspaper column contributed by a university professor has triggered a lawsuit for defamation. After Park Sang-yong, a professor of business administration at Yonsei University, wrote a column calling for a revision of a law regulating credit unions, the credit cooperatives ran advertisements rebutting his arguments and filed a lawsuit against him, seeking 1 billion won ($757,000) in damages and trying to garnish his salary. On Monday, the conflict led seven academic societies of economists, including the Korea Economic Association, to issue a statement in a joint attempt to help Mr. Park. They warned that the suit would set a dangerous precedent that might undermine the critical function of scholars. It is a pity that pride has led to this clash, which will not be good for the future of the credit unions.

In fact, local credit cooperatives have grave managerial problems. They received 2 trillion won in bailout funds from the government in the aftermath of the financial crisis of 1997. Some are still struggling, and the National Credit Union Federation of Korea started a controversy recently by refusing to carry out a restructuring plan drawn up by the Financial Supervisory Commission after it suffered accumulated losses of 500 billion won. The federation rejected the plan on the grounds that it was not a financial institution subject to financial restructuring laws. If that is right, how did it get the bailout funds?

The credit unions have gone too far by taking the matter to court in an attempt to gag critics. That action is an attack on public debate of social issues. The credit unions will also end up being blamed for being selfish. If Mr. Park made any unfair statements in his column, he should apologize, and that should be the end of the whole matter.

Both sides - the academic community and the credit unions - are gearing up to fight a court battle. But this is not a matter that should be left entirely to a court's judgment. We hope the battlers will take a step back to find grounds for a compromise and work together to clean up our credit unions and make them prosper.
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