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(EDITORIAL from Korea Times on July 29)

All News 07:07 July 29, 2022

Fox guarding henhouse
State-run housing developer needs overhaul

Barely a year ago, Korea Land & Housing Corp. (LH) apologized to the public for speculative property purchases based on access to insider information by some of its employees and announced a sweeping reform plan. However, those apologies seem to have been mere words, as shown by the result of the top audit agency's recent inspection of the state-run housing developer. The audit results reaffirm that it is no exaggeration to say that the government has let the fox guard the henhouse.

For example, LH included public development information that should have been kept secret until public announcements in conference materials. It also accepted the oral consent of officials responsible for development projects for the use of personal information. Due to these practices, some bought land in the names of their siblings or relatives, exploiting such insider information and loopholes. The Board of Audit and Inspection asked the police to investigate 17 LH and land ministry officials for allegedly buying farmland without any plans to farm it.

In another example that showed lax discipline among LH officials, three of its executives are under internal audit for reportedly playing golf during a business trip to Jeju Island. These LH executives even ignored their colleagues' warnings about such "inappropriate acts." Prime Minister Han Duck-soo promised to "give them a proper reprimand" during the National Assembly's interpellation session of the administration on Wednesday.

The government established the state housing developer with taxpayers' money to supply affordable homes and develop land for public purposes. As it turned out, however, some employees have used LH as a tool for making windfall profits by taking advantage of confidential development information. When these LH-related scandals first broke out, the government pledged to undertake reforms, amending five acts to prevent future speculation and corruption by public officials. However the recent audit shows that the culture of LH employees violating rules and laws in order to speculate still persists there.

Against this backdrop, the government designated LH a "financially risky institution" recently, citing its accumulated debt, and the latter came up with a major innovation plan. However, the government must check ceaselessly whether LH has been keeping its promises. Law enforcement authorities should also thoroughly investigate officials referred to them and punish them adequately if irregularities are found. They must not repeat last year's controversy by slapping them on the wrist.

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