[EDITORIALS]Shameful use of rescue fundsThe prosecution’s investigations have again uncovered corruption among businessmen who received bailout funds to rescue their collapsing firms.
According to the prosecution, Nasan Group illegally used the firm’s money to buy real estate, including commercial buildings and a country club, in an attempt to avoid paying its debts. The practice was carried out even after the company went bankrupt. The firm provided corporate credit cards to relatives of the owner, and company funds were spent on personal entertainment.
One of Korea’s largest paper manufacturers was caught by an employee while trying to raise illicit political funds. The firm then had to pay hush money to the worker. What a shameless deed. We always wondered why those companies were still bankrupt even after receiving such large bailout funds. The reason was a lack of ethics.
We understand some inevitable shortcomings in providing bailout funds. Providing such rescue funds under emergency situations without proper legal and systemic guidelines often created a leakage of money. After some bailout funds were spent improperly, it became difficult to hold someone accountable for such practices, and those who merely approved the spending were blamed. That, however, cannot justify the corrupt use of bailout funds.
Up to 4 trillion won ($3.3 billion) will be provided to aid the sale of Korea Investment and Securities Co. and Daehan Investment and Securities Co. Since the 1997-98 foreign exchange crisis, 161 trillion won of public funds have been provided. Of the total, 69 trillion won, or 87 trillion won including interest, is not recoverable.
There can be no time restriction on probing corrupt uses of bailout funds. Despite the prosecution’s efforts, more companies have to be investigated. It is necessary to thoroughly probe all corruption and severely punish those responsible in order to end this unfortunate cycle of raising and spending bailout funds. Businessmen should also learn some lessons and heighten their transparency and management ethics.