Banks lost W500b due to employees’ financial crimes in last 5 years

South Korean banks and their prospects misplaced practically 500 billion gained ($428 million) from staff’ monetary crimes — together with embezzlement and fraud — within the final 5 years, information compiled by the nation’s monetary watchdog confirmed Sunday.

Twenty native lenders noticed losses price a mixed 488.four billion gained by means of 186 instances from 2016 to June this 12 months, in response to information submitted by the Monetary Supervisory Service to Rep. Lee Younger, a lawmaker of the principle opposition Folks Energy Social gathering.

Of the entire instances, people who occurred underneath the roofs of the 4 main banks — Shinhan, Woori, KB Kookmin and Hana — accounted for some 60 %, at 109 instances.

Yearly, 2016 noticed the best variety of instances and quantity misplaced — 48 instances and 351.three billion gained. There have been 21 instances that value banks three.1 billion gained by means of June for this 12 months.

Embezzlement accounted for practically half of the pie, with 90 gathered instances, whereas fraud accounted for 30.6 % with 57 instances and breach of belief accounted for 14 % with 26 instances. Theft accounted for four.three % with eight instances.

However when it comes to cash, fraud dealt the heaviest blow to the establishments and its prospects with 403.four billion gained — 82.6 % of the entire.

Woori Financial institution noticed probably the most monetary crimes taking place underneath its roof, with 33 instances within the cited interval. KB Kookmin and Shinhan each got here at No. 2 with 27 instances every and Hana ranked No. three with 22 instances. NH Nonghyup trailed with 19 instances.

The state-run Industrial Financial institution of Korea, nonetheless, misplaced the biggest sum of money in the identical interval, with 15 instances price a mixed 133.7 billion gained. One other state-run establishment, Korea Improvement Financial institution got here at No. 2 with 5 instances price 129.eight billion gained.

Regardless of efforts by the monetary authorities to curb monetary crimes dedicated by staff in each state-run and personal establishments, new loopholes proceed to be found with technological advances yearly.

In April, it was discovered that an worker of Woori Financial institution embezzled 185 million gained for private funding in cryptocurrency. The worker was reportedly fired afterward.

“Most monetary scandals in banks stem from the staff’ sense of ethical hazard,” Rep. Lee mentioned.

“It’s essential for the banks to ascertain stable requirements for worker administration and measures to curb recidivism by means of stricter punishments,” she added.

By Jung Min-kyung ([email protected])