More Korean FSS retirees find jobs in legal, financial biz

More retirees of the Financial Supervisory Service (FSS) are snagging new jobs at private companies such as the banks they regulated during their terms as well as law firms, casting doubts among the public over the South Korean regulator’s ability to avoid conflicts of interest.

South Korea bans FSS officials of Grade 4 or higher, who have worked for the watchdog for about five years or more, from getting jobs at private financial institutions within three years of retirement.

The government grants approval for employment in some cases, however. It allows them to work for a sector if their work in the five years preceding retirement was unrelated to the sector where they plan to work, for example.

With such exemptions, 22 retirees from the FSS have been hired by banks, financial holding companies, insurers, credit card issuers, securities companies and accounting firms so far this year, according to a ruling-party lawmaker’s data collected from the regulator. The FSS supervises those financial institutions.

Law firms were also favorite next destinations of FSS retirees.

Kim & Chang, the country’s top law firm, employed 11 former FSS officials from 2020 to 2022, the data showed. Its rivals Lee & Ko hired eight in the last 10 years, while Bae, Kim & Lee LLC. and Yulchon LLC. employed four each.

GROWING DESIRE BY FSS RETIREES TO WORK IN PRIVATE SECTOR

The government has approved 190 former FSS officials’ employment in the private sector out of 207 applications among 793 retirees from 2013 to June this year.

FSS retirees have been increasingly seeking jobs at private companies with the government reviewing 28 applications for such employment permissions in the first half of this year alone. The authority processed only two applications in 2013 and three in 2014. The number jumped to 40 in 2021 although it dipped to 35 last year.

FSS Governor Lee Bokhyun said last month that the regulator must not create any conflict of interest when its staff engages with former FSS officials who are working for private companies.

“We must ensure that there is no misunderstanding from the general public’s perspective in personal contacts with former FSS officials who are working at financial institutions or with regard to their recruitment by financial companies,” Lee said.

Write to Hanjong Choi at onebell@hankyung.com
 
Jongwoo Cheon edited this article.