[EDITORIALS]Internecine warThe Board of Audit and Inspection and the Ministry of Finance and Economy are waging an ugly battle. The ministry and the Financial Supervisory Commission issued a statement challenging the audit board’s assertion that the 2003 sale of Korea Exchange Bank to Lone Star Funds, a U.S. private equity fund, was handled correctly. The situation, a head-on clash between auditor and audited, is unprecedented.
Although the Finance Ministry called the statement an “explanation,” its content is a refutation. The ministry is trying to show that it has been falsely charged in the audit agency’s findings that the Korea Exchange Bank sale was inappropriate.
There is no rule that says a conflict between government agencies should not occur. But it is not appropriate for the Finance Ministry, even before the prosecution has completed its investigation, to try to appeal to the public.
The Korean people are not comfortable with the immense leakage of Korea’s national wealth out of the country. Even if it were inevitable at the time to approve the sale, not many people would side with the ministry right now. If the ministry and the Financial Supervisory Commission were so confident in the correctness of their decision, they should wait and make their case to the prosecutors.
If the inspection by the audit agency was properly done, the situation would not have developed into such a deplorable one now. The Board of Audit and Inspection is the country’s institution for evaluating the performance of administrative agencies and public servants.
The problem is that the agency seems unable to reach any conclusions. It is shameful that the auditors could not get to the bottom of the matter even after a three-month audit. So many criticize the report as a simple compilation of widespread suspicions that did nothing to confirm or refute them.
In fact, the deliberate lowering of the Bank for International Settlements ratio for the sale of Korea Exchange Bank at a low price is not the core issue.
The issue is why the government was obsessed with selling the bank while Lone Star was looking methodically at a possible investment.
Many Koreans are dubious about leaving the country’s fate to a government that is not capable of looking ahead. It’s hard to say that more complications in sales of Korean commercial entities to foreigners will not happen again in the future.