FSS vows reform after audit finds misconduct

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FSS vows reform after audit finds misconduct

Korea’s top financial watchdog plans to execute a set of internal reforms after a government audit discovered misconduct including unfair hiring, dubious trading and lax management.

The Board of Audit and Inspection said Wednesday that it found 52 cases of misconduct at the Financial Supervisory Service and demanded penalties for five high-ranking officials.

The unfair employment practices occurred last year, when the Financial Supervisory Service hired more people than initially planned in order to take in a person with ties to the agency.

The applicant was not supposed to make the first screening round because the test score was not among the top 22, but a director requested the threshold be raised to 23, allowing the candidate to proceed to the final interview and become employed.

Another case involved an employee putting down the wrong university in an apparent attempt to gain extra credit given to graduates of schools outside Seoul. Even though the applicant graduated from a Seoul-based collage, the resume listed a university in Daejeon, South Chungcheong.

The hiring decision didn’t change after the alteration was revealed, even though the candidate would have failed to land the job without the extra points.

Besides unfair hiring, the audit also revealed an inefficient personnel structure. Nearly half of the agency’s employees were senior bureaucrats, with grades 1 to 3, but of these 871 people, 63 had no official positions.

The audit noted there was lax operation of the agency’s eight overseas offices. The Financial Supervisory Service allocates 7.8 billion won ($6.9 million) every year to these offices, which have 20 officials stationed there. But the vast majority of information coming from these overseas offices could be found on the internet, negating the need for their presence.

Despite this, the Financial Supervisory Service plans to add an office in Singapore by the end of this year.

In response to the audit, the agency is scrambling to improve its practices and strengthen monitoring of recruitment. It pledged on Wednesday to adopt a so-called blind hiring process where the backgrounds of candidates such as schools are hidden.

Another measure is bringing outside experts into the hiring process to prevent any favorable treatment.

“We will come up with specific measures by October and try to implement follow-up steps by the end of this year,” a source at the Financial Supervisory Service said.

BY PARK EUN-JEE [park.eunjee@joongang.co.kr]
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