National Agricultural Cooperative Federation President Kang Ho-dong was reprimanded at a parliamentary audit over bribery allegations and controversy over patronage appointments. As Kang is being investigated by police while also facing calls to resign, some say NongHyup is in crisis.
Jeon Jong-deok of The Progressive Party asked at the Agriculture. Food. Rural Affairs. Oceans. and Fisheries Committee's audit on the 24th, "Should the farmers' president be investigated over alleged illegal corruption? With alleged personnel corruption and even bribery, is NongHyup a department store of corruption?" He then asked, "If the corruption allegations turn out to be true, are you willing to resign?"
Kang said, "I have repeatedly said I am ashamed and sorry," adding, "I am undergoing a series of investigations and will make everything clear in the process."
Earlier, on the 15th, police raided the office of National Agricultural Cooperative Federation President Kang Ho-dong. Kang was elected in the National Agricultural Cooperative Federation presidential election held in Jan. last year. Police are said to believe that around the end of 2023, when Kang ran for National Agricultural Cooperative Federation president and was favored to win, he received cash totaling a little over 100 million won on two occasions from a representative, identified as A, of a service firm that had a transaction relationship with a National Agricultural Cooperative Federation affiliate.
Yoon Jun-byeong of the Democratic Party of Korea also said that among NongHyup's 22 senior managing directors, 18 came from Kang Ho-dong's campaign, calling them "parachute appointments." He added, "The police raid (of the federation president's office) was in some ways brought on internally. Patronage appointments for those who helped with the campaign fuel such suspicions."
Yoon also pointed out that while Kang concurrently serves as the president of Nongmin Shinmun, a standing (full-time) executive post, he reported to work only 40 days during the 1 year and 6 months since taking office but received nearly 500 million won in salary, abusing the dual-post system.
The case of Seoul Jungang NongHyup head Kim Chung-gi was also raised. In the 2023 nationwide simultaneous cooperative head elections, he pledged to give each member 15 don of gold and a free overseas tour, prompting a recent police investigation. After being elected, Kim gave gold bars to members.
Cho Seung-hwan of the People Power Party said, "It's a matter of common sense," adding, "Fifteen don of gold is vote-buying." From the same party, Cho Kyung-tae said, "Across three rounds of nationwide simultaneous cooperative head elections, more than 800 people have been punished, yet money-for-votes elections continue," criticizing that "NongHyup's moral hazard is getting increasingly serious."
Kang said, "I am ashamed," adding, "I am sorry for causing public controversy over the cooperative head elections. I will improve the system."
Jeon Jong-deok of The Progressive Party also said, "The head of Janghang NongHyup in Seocheon County, South Chungcheong Province, was sent to the prosecution on charges of sexual harassment and abuse of power against a female employee, but the National Agricultural Cooperative Federation is turning a blind eye and has not even separated the perpetrator from the victim." In response, Kang said, "I am sorry for the corruption and various problems at regional NongHyup branches," adding, "We will provide guidance and impose sanctions to prevent a series of such incidents."
There was also criticism that NongHyup's mutual finance institutions are sinking deeper into trouble. NongHyup mutual finance institutions' total delinquent amount surged from 950 billion won at the end of last year to nearly 1.8 trillion won by the end of June this year, just six months later. The joint loan delinquency rate at NongHyup mutual finance institutions was tallied at 19.2%.
NongHyup's economic operations are also deeply in the red. Of the 11 subsidiaries under NongHyup Economic Holdings last year, four posted losses, with Hanaro Distribution and NongHyup Distribution accounting for most of the losses, at 39.8 billion won and 35.2 billion won, respectively.