Auditor blames South Korea's regulatory bodies
Lax financial supervision by government regulatory bodies and reckless expansion by credit card issuers are to blame for South Korea's massive consumer debt crisis, the country's audit agency has concluded.
South Korea's Board of Audit and Inspection has called for a merging of the three supervisory bodies with responsibility for overseeing regulation of the financial markets.
The board criticised the lack of co-operation between the Financial Policy Bureau of the Ministry of Finance, the Financial Supervisory Commission and the Financial Supervisory Service.
It said the bodies failed to oversee the card issuers' excessive bid for market share.
The Finance Ministry said it would work with the other two financial watchdogs to correct the systemic problems that had led to the consumer credit crunch. 'We are in the process of setting up an early-warning system to prevent a reoccurrence of past mistakes and strengthen our ability to regulate card companies,' said Park Jae-seok, a director of the ministry's Financial Policy Bureau.