# Assistant contractor A purchased equipment through the Korea Electronic Procurement System, called 나라장터. The period during which he posted announcements on 나라장터 was only 3 days, including the weekend. It is generally a principle that emergency announcements should be conducted for at least 7 days, which was too short. The officials who conducted the crackdown found it suspicious that the equipment in question had thick labels attached. It turned out that he had placed labels from company C, with which he had signed a contract for the item, onto the equipment originally owned by company B. This is known as "label swapping."
# The representative of the assistant contractor, D, entered a contract with company E. However, both D and company E had the same address. When the officials who conducted the field inspection asked, "The address of company E is here, but where do you work?" a related person only pointed to a corner of the office. It was found out that it was a "ghost company" owned by D's son. Additionally, D paid salaries to his son and daughter, who did not work there, and also entered into a contract with company F, whose representative is his older brother. Furthermore, he purchased alcoholic beverages prohibited from being acquired with subsidies.
Last year, government subsidies amounting to 50 billion won for 'improper receipt' were uncovered by the government. Government subsidies refer to funds provided by the central government to local governments or individuals for the costs incurred in promoting projects deemed necessary for policy. Due to the sheer number of assistant projects and the various tricks employed, there had been many leaks, often treated as "blind money," but recently the government has been strictly cracking down.
The Ministry of Economy and Finance stated on the 19th, during a meeting of the joint enforcement monitoring team headed by Deputy Minister Kim Yoon-sang, that a total of 630 cases of improper receipt of subsidies were detected through the government's integrated management system for national subsidies (e-Nara Doem) and joint field inspections, amounting to 49.3 billion won. This detection result is from crackdowns on assistant projects executed between July 2023 and June 2024.
This detection result marks the highest ever in terms of the number of cases. It represents a 1.3-fold increase compared to 2023 (493 cases). However, the amount detected does not reach that of 2023 (69.9 billion won). Regarding this matter, Lim Young-jin, head of the National Subsidy Improper Receipt Management Team, explained, "After the presidential election, about 5 billion won of supplementary budget was arranged, aimed at overcoming COVID-19, which hastily included many disqualified small and medium-sized enterprises, presenting unique circumstances."
Improper receipt methods varied widely. One assistant contractor recruited businesses not through the official bidding route via the procurement agency's 나라장터 but through their website and selected company G via an internal evaluation. They only formally announced the bid on 나라장터 two months after signing a contract with company G. Moreover, the representative of company G was related to the assistant contractor's representative. Investigations revealed they had engaged in this transactional relationship for five years, improperly receiving 3.91 billion won in subsidies. The case is currently under audit by the Board of Audit and Inspection.
The National Subsidy Improper Receipt Management Team noted, "Fake contracts, label swapping, and familial transactions account for 87.4% of the total amount detected." In addition, numerous acts of ▲managing specific transactions and overlapping labor costs ▲violating contract procedures ▲executing misuse or abuse (such as paying subsidies at late-night pubs) were detected.
The projects that have been caught are subjected to a review by the improper receipt review committee of the relevant department, followed by further verification through police investigations. If determined as "improper receipt," measures such as recovering subsidies, collecting penalties, exclusion from project execution, and public disclosure of names will be implemented.
This year, the government plans to strengthen activities to crack down on improper receipt of subsidies even further. Currently, the number of detected improper signs stands at 8,079 cases and 510 cases for field inspections, both of which are set to exceed 10,000 and 500, respectively. The patterns aiding in the preliminary screening of suspicious cases through the e-Nara Doem's detection system, which currently has 69 types, are also planned to be expanded through further learning. The Ministry of Economy and Finance stated, "We will thoroughly manage to track down and recover even a single won of subsidies to prevent any waste."