FSS holds public consumer protection report event
Financial supervision paradigm shifts from 'post-remedy' to 'prevention'
Voice phishing losses fall 53.5% to 361.4 billion won in January–July
![Front row, from left: Yun Ji-young, deputy editor at Seoul Economic Daily; Jeong Un-young, chairman of the Finance and Happiness Network; Moon Mi-ran, chairwoman of the Citizens Consumer Group; Kim Seon-hong, financial consumer; Kim Woo-chan, professor at Korea University; FSS Governor Lee Chan-jin; Park Hyun-jung, financial consumer; Lee Jun-hee, financial consumer; Pyo Chang-won, professor at Hallym University; Kim Jong-bo, director of People's Solidarity for Participatory Democracy.
Back row, from left: Lee Gon-ho, attorney at Dongin Law Firm; Kim Seong-uk, FSS deputy governor for banking and small finance; Lee Se-hun, FSS senior deputy governor; Jang Gwon-young, Korea head of BCG; Bae Gwang-su, CEO of NH Investment & Securities; Jo Chang-hyeon, CEO of Hyundai Card; Gu Bon-uk, CEO of KB Insurance; Park Hyun-joo, senior executive vice president of Shinhan Bank; Park Ji-seon, FSS head of financial consumer protection; Kim Uk-bae, FSS deputy governor for consumer protection; Hwang Seon-o, FSS deputy governor for capital markets and accounting. [Financial Supervisory Service]](https://wimg.heraldcorp.com/news/cms/2026/09/17/news-p.v1.20260917.c752e7942fdf4764be3c233e1a6eaa4b_P1.jpg)
Detected insurance fraud in the first half of this year totaled 620 billion won ($453 million), up 9.1 percent from the same period last year, while voice phishing losses in the January–July period fell to less than half the year-earlier level. The figures mark the Financial Supervisory Service's one-year scorecard since it shifted its supervisory paradigm from post-remedy to prevention.
The FSS held a public consumer protection report event Thursday at its headquarters in Yeouido, Seoul, with about 250 participants including financial consumers, industry representatives and outside experts. The FSS presented its achievements over the past year under three categories: governance and complaints and disputes, blocking financial crimes that harm livelihoods, and support for vulnerable groups and improved financial well-being.
In the area of blocking financial crimes, insurance fraud detections rose sharply. The amount detected in the first half reached 620 billion won, up 9.1 percent from 568.2 billion won in the same period last year, while the number of people caught climbed 5.6 percent to 53,865 from 51,016. The FSS identified clinics suspected of issuing false medical records to enable claims under indemnity health insurance and referred 14 hospitals to investigators on suspicion of illegally rebating part of non-covered medical fees to patients. Since June, the FSS has been operating a task force with the Korean National Police Agency, the National Health Insurance Service and Korea Credit Information Services to build an AI-based insurance fraud prevention system, working toward an integrated platform that centralizes and shares information on suspected insurance and medical crimes.
Voice phishing losses fell sharply. The number of cases from January through July came to 7,940, down 46.0 percent from the same period a year earlier, while losses dropped 53.5 percent to 361.4 billion won from 777.6 billion won. The financial sector used the AI-based voice phishing information-sharing and analysis platform known as ASAP from October last year through July this year to freeze 7,009 accounts and prevent 66.36 billion won in losses. On illegal private lending, the FSS halted 1,360 cases of illegal debt collection through SNS and issued 430 certificates voiding unlawful loan contracts.
![The public consumer protection report event held at the Financial Supervisory Service on Thursday. [Jeong Ho-won]](https://wimg.heraldcorp.com/news/cms/2026/09/17/news-p.v1.20260917.2941e3702297497fbfd74ca41082b5c5_P1.png)
In the complaints and disputes area, the FSS accelerated victim relief. It regularized monthly meetings of the dispute mediation committee and, in connection with the Tmon and WeMakePrice crisis, recognized the right of consumers who paid by installment for travel and airline tickets but never received the service to cancel their purchases — establishing a processing standard for 11,696 disputes of the same type involving 13.22 billion won. Since July last year, the FSS has logged 94 cases in which problems identified during complaint and dispute handling were fed back into regulatory improvements.
However, the FSS identified complaint and dispute handling capacity as an area needing improvement. The number of complaints and disputes filed has been rising, from 34,628 in the third quarter of last year to 40,668 in the second quarter of this year. FSS Governor Lee Chan-jin said in his opening remarks Thursday that complaints and disputes continue to increase and that practices prioritizing short-term earnings over consumers' best interests and long-term trust remain entrenched in the financial sector.
Jang Gwon-young, Korea head of Boston Consulting Group, presented a three-stage maturity model for consumer-centered management in an outside expert address at the event. The three stages are: complying with regulations and responding when problems arise; deepening consumer understanding and translating it into product and service competitiveness; and making consumer protection itself a distinctive competitive edge and a source of corporate value. Jang said the regulatory improvements of the past year had laid the groundwork for preventive supervision, but assessed that domestic financial institutions have only just cleared the first stage and that genuine innovation is still in its early phases. He also recommended shifting the standard for consumer protection from mere regulatory compliance to "good customer outcomes" — the actual results consumers receive.
Governor Lee said that since the change consumers feel on the ground is the true measure of success, Thursday's report is not a conclusion but a starting point, adding that the FSS will pay closer attention to difficult and uncomfortable voices rather than those that are easy to hear.
won@heraldcorp.com
