A view of Yeongcheon City Hall [Yeongcheon City]
A view of Yeongcheon City Hall [Yeongcheon City]

A Grade-7 accounting official at an administrative welfare center in Yeongcheon, North Gyeongsang Province, is suspected of manipulating the city's financial system hundreds of times to embezzle 2.5 billion won ($1.68 million) in public funds.

The city said Monday that the employee, identified only as A, manipulated the local government's financial management system — known as e-Hojo — more than 230 times between last November and last month, transferring 2.5 billion won into a personal bank account.

The scheme came to light during an internal accounting audit conducted this month. A, who handled all accounting duties at the center, obtained approval from supervisors by making the transactions appear to be legitimate budget expenditures — such as payments for public utility bills — but in practice diverted the money into a personal account. The fraud was eventually detected after the center's budget balance showed a shortfall due to what appeared to be excessive spending.

The city became aware of the illegal activity on Tuesday and immediately referred the case to police. A has since been removed from the post.

Allegations have also emerged that A used the embezzled funds to invest in cryptocurrency. Police plan to determine through their investigation how the public money was spent. The city also intends to conduct its own probe into whether A's team leader and the head of the administrative center adequately supervised the employee's work on a day-to-day basis.

"We will verify whether routine oversight of A's duties was properly carried out," a city official said. The official added that the misappropriated funds have not yet been recovered, and that the investigation is expected to reveal how the money was used.

Yeongcheon Mayor Kim Byeong-sam held a press conference Monday after the case became public, offering a sincere apology to residents. "We will strictly hold all those involved accountable based on the results of the investigation, and we will pursue and recover every last won of the misappropriated public funds," Kim said.


soho0902@heraldcorp.com