Sejong bureaucrats may have flipped apartments for profit

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Sejong bureaucrats may have flipped apartments for profit

Prosecutors launched an investigation into allegations that government officials made illegal profits worth tens of millions of won by selling their apartments in Sejong City, after they acquired them below the market value through a special government program.

The Daejeon District Prosecutors’ Office reported Thursday that it had raided six real estate agencies in the special administrative capital and confiscated transaction documents to track down government officials involved in illegal sales of their apartments.

To help government officials settle in Sejong, some 120 kilometers (75 miles) south of Seoul, the government had allowed them to purchase newly built apartment units at cheaper prices in 2010.

The government prohibited public officials from selling their apartments for a year, which was extended to three years in 2014.

Since 2012, 36 government agencies have settled in the special administrative city, which used to be a quiet farming county in South Chungcheong, bringing with them over 10,500 civil servants.

With the confiscated documents, prosecutors are expected to look into transaction records and compare it with a list of government officials who bought units at special prices during the initial phase of the Sejong settlement.

Rumors have been rampant in the civil service community that a large number of public workers pocketed profits by selling their apartments for profits of up to 150 million won ($128,000).

Late last year, the Sejong city government reviewed real estate acquisition taxes paid by city residents. It discovered that out of 9,900 government workers who secured apartment ownership, only 6,198 actually moved in. The city government estimates that over 2,000 government officials engaged in illegal transactions. It is thought that those who opted not to settle into the city and profited from selling their apartments commute from Seoul to Sejong.

The allegations that more than 2,000 government workers had raked in money by engaging in illegal activity has sparked questions about their morality.

“The government gave them a special offer to help them settle down in Sejong,” said Lim Dong-hwan, a Sejong resident. “It is just outrageous that they instead took advantage of the special treatment to profit from it.”

One real estate agent in Sejong said a bigger problem lies in the practice in which civil servants cut down on their transaction tax by falsifying transaction records and changing the amount they pay for their apartments.

One government official said they were unfairly being singled out.

“There was a sentiment [in the community] that one must be a fool for missing such an opportunity to sell [at a profit],” said the official, who asked for anonymity. “Government workers in Sejong deserve some compensation for giving up our lives in Seoul.”

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