FSC tempts whistle-blowers with inflated rewards

In a bid to minimize corruption and irregularities involving savings banks, the financial regulators will ramp up the reward offered to whistle-blowers six-fold, the Financial Services Commission (FSC) said yesterday.

Currently, up to 50 million won ($44,290) is given to insiders who report misdeeds of savings banks’ executives and shareholders, such as their wielding undue influence, but it will expand the scope to include those who authorize loans using borrowed names.

The new measure is aimed at improving the transparency of savings banks, which have had their reputations tainted by a series of embezzlement and fraud scandals last year.

As such, the FSC will also tighten its standards for reappointing large shareholders and executives by conducting evaluations on them on a regular basis. At present, it subjects savings banks with more than 2 trillion won of assets to once-a-year evaluations or double this for those with smaller assets.