PSPD in English Archive 2001-01-31 2702

PSPD’s Campaign for the Enactment of Anti-Corruption

Establishment of the Transparent Society Campaign Center in 1996

Rim Mi-Ok (Coordinator Transparency Campaign PSPD)

The death of 32 people by the collapse of the Sung-su bridge in 1994, the taxation scandal of the In-chon Buk-gu office, the collapse of the Sam-pung department store with 501 people’s death in 1995, the arrest of former presidents Cheon and Roh for a slush fund scandal in 1995, the gas explosion, and the economy. The signature-collecting drive for the enactment of the Anti-Corruption Law targeted general election candidates and obtained 320 candidates promises. The center also held a one million signature-collecting drive, the ‘Citizens” March for a Clear and Safe Society’ in June, and launched the campaign, Civic Participation Week for the Elimination of Corruption, from mid-October to early November. In addition, during 1996 there were six forums, including the Forum for the Enactment of an Anti-Corruption Law, and the International Movement against Corruption and the Choice of Korean Society.

The various efforts, as illustrated above, boosted public consensus on the enactment of Anti-Corruption Law. On November 7, the center filed a petition for the law to the National Assembly with signatures of 156 lawmakers and 23,000 citizens.

Necessity and Features of the Anti-Corruption Law

Although elimination of corruption was pledged repeatedly as new administrations were inaugurated, irregularities and corruption have not been eradicated at all, but are getting even worse. This is because each administration”s anti-corruption policies have been performed as rules to benefit the ruling camp, or else have continued only for a short time.

Korea has many laws and rules to regulate corruption, such as the public officials’ code of ethics. The Prosecution, the Board of Audit and Inspection and many other authorities are also dealing with corruption. However, those laws and institutions have been completely unsuccessful in preventing corruption because of the lack of essential systems. At the same time, audit and inspection authorities themselves have been corrupted, and have been unable to strictly deal with scandals under the pressure of political power.

To overcome these limitations and cope with deep rooted corruption in the society more effectively, the PSPD drafted the Anti-Corruption Law as a comprehensive measure to prevent corruption. The law was made from the existing public officials” code of ethics, and added new rules such as whistleblower protection, prohibition of money laundering, and the institution of an independent investigation authority. The following explains the uniqueness and main features of the law.

First of all, the law included an all-out effort against corruption. Since the existing laws deal with corruption individually and not comprehensively, they cannot prevent and regulate corruption effectively. Therefore the PSPD drafted a singular and comprehensive anti-corruption law that put individual laws together and added new preventive measures.

Second, the law is intended to overcome the limit and weakness of the existing public officials” code of ethics. Even though the code has provisions on financial disclosure, uprightness and honesty, report of gifts from outside sources, and restriction on post-employment, it has been ineffective in practice. The law supplemented the existing provisions concerning financial disclosure and added more concrete regulations, including restriction on income from sources other than the official job, exclusion from interest-related positions, the type of banned gifts and the handling process for receiving them, and restrictions on re-employment of corrupt officials.

Third, the law introduced a system for whistleblower protection. Whistle blowers have had to put up with disadvantages from the bureaucracy. Therefore experts have emphasized that whistleblower protection is critical for the prevention and control of corruption. The law included the protectionof informants” identities and security, and the offer of incentives for whistle blowing.

Fourth, a system to prevent money laundering was included in the law. As the financial industry and its techniques have advanced, investigation of money laundering for illicit funds is getting difficult; as a result, corruption is getting worse. In particular, money-laundering techniques, which are getting sophisticated, and financial institutions which unlawfully collaborate on money laundering, made the investigation of illicit funds harder. The slush fund scandal of the two former presidents, Cheon Doo-hwan and Roh Tae-woo was a typical case that showed the need for punishment of money laundering. The Anti-Corruption Law drafted by the PSPD included strict regulation and punishment of money laundering, as is done in many other countries.

Fifth, the law stipulated thorough investigation and punishment of corruption and irregularities. No Chaebol tycoon involved in big scandals was actually punished, except for Hanbo, Kia, and some other Chaebol owners whose conglomerates failed. The most effective way to prevent corruption is to show that corruption will inevitably be uncovered and punished. Therefore, the law had such provisions as severe punishments for corruption, prohibition of corrupt officials from re-employment, rigorous forfeiture, punishment of higher officer who connived his or her subordinates” dishonesty, and the aggravation of audit and inspection officials” crimes.

Finally, the law prescribed the establishment of a strong and independent investigation institution. Strong investigation authorities always accompany an effective law. The Prosecution in Korea has not been independent and fair in most political cases. Therefore, the Anti-Corruption Law stipulated the institution of a separate investigation office, and the appointment of a special prosecutor for senior officials” scandals.

Change of Lawmakers Attitude about the Anti-Corruption Law

Since the petition for the Anti-Corruption Law in 1996, the PSPD has continued the campaign for the enactment of the law by holding dozens of seminars, forums, rallies, and signature seeking drives. In 1999, about 200 NGOs went on a sit-in strike demanding the enactment of the law and the naming of a special prosecutor. However lawmakers, whose attitude toward the law varied based on partisan interests, paid little attention to its enactment.

In December 1996, the opposition party, the National Congress for New Politics (NCNP), presented a draft of the Anti-Corruption Law which was the same as the PSPD”s. However the ruling camp, the Grand National Party (GNP), opposed the enactment of the law. After the NCNP took power in 1998, President Kim Dae-jung ordered its enactment. The NCNP also made a statement promising to enact the law within a year in its Liberation Day speech. The PSPD held a signature collecting drive for the passage of the law for four month from September on, and 256 out of 299 lawmakers joined the campaign. Nevertheless, the Prosecution, the Ministry of Justice, and the Board of Audit and Inspection wanted to protect their vested rights and interests, and so were against the law, because it called for the institution of an Investigation Office for Senior Officials” Wrongdoing and the appointment of a special prosecutor. The NCNP also broke its promise, and in December 1998 presented its version of the Anti-Corruption Law without provisions for the institution of the Investigation Office for Senior Officials” Scandals.

In the meantime, the GNP demanded the naming of a special prosecutor, which it had been against as a ruling party, while arguing that the Prosecution was investigating them for political reasons.

In 1999, the so-called ‘Fur-gate’, and the graft scandal involving a lawyer in Taejon, stirred up a national demand for measures against corruption. To respond to the need, the government set up a Special Committee for Anti-Corruption as a presidential committee. The NCNP, however, presented an inferior draft of the Anti-Corruption Law to the National Assembly in December 1999, which excluded the provisions of a revised public officials” code of ethics and for the regulation of money laundering. According to new draft, the Anti-Corruption Law would be limited to a basic rule with only the provision of a Special Committee for Anti-Corruption and Whistleblower Protection, far from the original draft”s comprehensive measures to prevent irregularities and corruption. Shortly after, the GNP presented its draft, in which the provision of a special prosecutor system was additionally included.

In other words, the NCNP, who had supported the Anti-Corruption Law and the special prosecutor system, excluded the provisions of a Public Officials Code of Ethics, the prevention of money laundering, and the institution of an Investigation Office for Senior Officials” Wrongdoing, and opposed naming a special prosecutor, while the GNP, who had been against the enactment of an Anti-Corruption Law, insisted on naming a special prosecutor.

Swayed by these partisan interests, Anti-Corruption Law failed to gain any consideration, even not a discussion, in the Legislation and Judiciary Committee, as the 15th National Assembly closed its door.

Launch of Civil Action for the Enactment of Anti-Corruption Law

President Kim Dae-Jung declared that he would make efforts to eliminate irregularities and corruption and to develop a more transparent society in 2000. In the 2000 general election campaign, both ruling and opposition parties pledged to enact the Anti-Corruption Law. They also agreed to enact the law in the inter-party summit after the general election.

Thirty-eight civic organizations, including the PSPD, organized a campaign, the Civil Action for the Enactment of the Anti-Corruption Law (CAEAL), and brought a joint draft of the law to a public hearing in July. The Anti-Corruption Law and the Act for the Prevention of Money Laundering were filed for legislation with the National Assembly. Two hundred and eight lawmakers in the 16th National Assembly joined the signature drive for the enactment of the law within the year.

The law presented by CAEAL was somewhat different from the PSPD”s draft in 1996. While the PSPD”s draft included the provision for preventing money laundering, the CAEAL”s draft set that provision apart as a separate bill, the Act for the Prevention of Money Laundering, since it had provisions for regulating illicit funds from drug trafficking, criminal activity, and other illegal activities as well as from irregularities and corruption. The special prosecutor system of the U.S. was also included in the new draft instead of the institution of an Investigation Office for Senior Officials” Wrongdoing, and the provision of a Special Committee for Anti-Corruption, established according to the presidential decree in 1999.

After the petition for legislation of the law, CAEAL launched a campaign for prompt enactment, including a national bicycle rally, a sit-in strike at Myungdong Cathedral, mass meetings, and interviews with the leaders of ruling and opposition parties.

In the meantime, the ruling camp, the Millennium Democratic Party (MDP), presented the Basic Law for Anti-Corruption to the National Assembly on November 25th, while the GNP presented the Law for the Prevention of Irregularities and Corruption on December 6th.

Defects of the MDP”s Basic Law for Anti-Corruption

Major parts of the Basic Law for Anti-Corruption presented by the ruling camp, the MDP, are provisions for whistleblower protection, institution of a Special Committee for Anti-Corruption, claims for civic audit and inspection, and rewards for whistle blowing. The biggest problem in the law is the lack of measures for investigating senior officials” scandals independently, as the provision of any special prosecutor system is excluded. The system has been requested by the public, and is believed to be an indispensable means of watching and reforming the Prosecution, who have monopolized the indictment right and abused it for political reasons. Nevertheless, the MDP did not even discuss the introduction of the system when they drafted the law. Measures to have the Prosecution exercise its authority impartially, such as the abolition of the monopolization of right of indictment and the blind obedience to senior prosecutors, the institution of a prosecutorial inspection committee, the reform of the retrial claim system, and the introduction of a hearing on the new public prosecutor general, have not been taken into consideration either, in spite of civic groups” proposals.

Another problem is that there is no concrete provision about officials” ethics. According to the law, specific regulations on officials” ethics, like limitations on taking gifts, money, other valuables and entertainment, procedures to handle banned gifts, restrictions on employment and income other than the official job, restriction on involvement in concessions and on asking or giving favors, are to be prescribed by separate principle, not by the law. Officials” ethics regulated by a principle would not work effectively to control the corruption in officialdom, since there would not be any legal authority to punish its violation.

Third, the Special Committee, which was intended to play the role of a comprehensive system to prevent corruption, becomes a titular authority. Institution of the Committee is the most important feature of the law. However, the Committee”s independence is threatened by the stipulation that the Committee should be a Presidential council, and the President would nominate not only the chairperson and one of standing committee members but also other members, who would be proposed by the chairperson. Moreover, even the provision of a right to request explanation or present information to the public office, which is the only method to oversee the bureaucracy, has exceptions for state secrets and for cases under investigation or trial. Thus the law”s effectiveness is limited.

Fourth, the law does not include any substantial procedure for investigating reported corruption and for protecting whistleblowers. The success of whistleblower protection depends on exactly how it protects an informant. The law prescribes transferring a reported case to the Board of Audit and Inspection or to other investigation authorities instead of awarding investigation rights to the Special Committee for Anti-Corruption that is originally informed of a scandal, with the result that an informant would have no need to report to the Committee. The punishment on those who discriminate against whistleblowers, or who fail to meet the restoration order of the Committee, is not specified either. In addition, since it does not clarify who has the burden of proof about discrimination against whistleblowers, the law is vulnerable to controversy in its execution, and would work against whistleblowers.

Fifth, the provision of rewards for information about squandering a budget is so discretionary that it is not effective. The provision will not work unless it guarantees a certain amount of incentive, based on the contribution, for an informant. Another problem is that there is no mention about alternative ways to deal with a case that the Special Committee for Anti-Corruption or the Board of Audit and Inspection refuses to investigate. To fix the problem, a taxpayer litigation law, like the False Claims Act of the U.S., must be enacted.

Defects of the GNPs Basic Law for Anti-Corruption

The GNP”s draft of the Law for Prevention of Irregularities and Corruption includes provisions for the institution of a Committee for the Prevention of Irregularities and Corruption, whistleblower protection, claim for civic audit and inspection, a special prosecutor system, and punishment.

The GNPs draft is more advanced than the MDP”s Basic Law for Anti-Corruption in that it includes provisions which civic groups have insisted were necessary, such as the investigation right of the anti-corruption authority, punishment for violation of informant protection, and a special prosecutor system. The law does not have a provision about officials” ethics, however, except restrictions on re-employment of public servants discharged for wrongdoing, whereas the ruling party”s draft stipulates setting the code of ethics as a discipline.

The law is right for awarding investigation rights to the Committee for the Prevention of Irregularities and Corruption and prescribing the punishment for the violation of whistleblower protection. The fine for the punishment of negligence, less than fifty thousand won, in cases of the violation of whistleblower protection is very weak, though. To prevent untruthful information, an informant who violates honest duty should be left unprotected by the whistleblower protection laws, rather than being imprisoned for from three to ten years.

Just as in the MDP”s draft, the law does not clarify the burden of proof about discrimination against a whistleblower, and its provision of reward for information about the squandering of budget is discretionary.

Essential Features of Anti-Corruption Law

The following should be included in the Anti-Corruption Law to prevent and strictly punish corruption.

First of all, there should be a code of ethics for officials. As explained above, the drafts of both the ruling and the opposition party do not have provisions about officials” ethics. It is not just because of the resistance from officialdom. Politicians who have committed those illegal activities fear to be punished if the ethics code is enacted and prohibits officials from receiving gifts, money or other valuables, from being involved in concessions, and from asking favors. A recent opinion poll shows that the public considers politicians the most corrupt group in society. The corruption cannot be eliminated unless politicians and officialdom are forced to be clean.

Secondly, the Special Committee for Anti-Corruption should have the right of investigation. The MDP”s draft excludes the provision of that investigation right, in contrast with the GNP”s draft, since the ruling party yielded it under the resistance of the Prosecution and the Board of Audit andInspection. Without the investigation right, the Committee would have no authority to regulate corruption.

Third, the punishment for violation of whistleblower protection should be clarified. The MDP”s draft does not have a related provision, and the GNP”s one is very insignificant. No one would abide by a rule without the fear of punishment if caught in violation. It must also be clarified that the burden of proof about the discrimination against whistleblowers is on the government agency that an informant belongs to.

Finally, a special prosecutor system should be introduced. The GNP”s draft includes it, while the MDP”s does not. Although the MDP insisted on the introduction of a special prosecutor system in the past, now as the ruling party they oppose it due to strong resistance from the Prosecution and their own fear of being hurt. The Prosecution”s repeated failure in investigating big scandals has resulted in the public”s distrust. The institution of a special prosecutor system will force the Prosecution to reform itself, keep impartiality, and, as a result, regain the public”s confidence.

Future Plan

On December 8, 2000, the Anti-Corruption Law was presented to the Legislation and Judiciary Committee for the first time since the campaign for its enactment began five years ago.

However, the draft petitioned by civic groups was not presented, and public hearing on the law were not opened.

President Kim Dae-Jung and both of the ruling and opposition parties pledged the enactment of the Anti-Corruption Law, and most of the nation also demands it as an important measure to reform society. Both the MDP”s and GNP”s drafts were far behind the expectation of civic groups and the public, so the Legislation and Judiciary Committee did not serve its responsibility to legislate perfect law that reflects the public”s opinion. Judging from past legislation activities and the incomplete contents of the drafts, both parties, as well as the Committee, seems to have a very weak will to eliminate corruption, in spite of their pledges to enact the law.

The recent downturn of the economy is the result of the government”s and politicians” poor action for eliminating corruption and reforming society. We ask, therefore, both parties to enact the Anti-Corruption Law so as to eliminate corruption and to continue social reform, and not to act simply in their own partisan interests. The PSPD will continue the campaign for the enactment of the law, such as monitoring the Legislative and Judiciary Committee, participating in public hearings, and lobbying both parties. The law should be an effective and strong one that includes a public officials” code of ethics, the institution of a powerful authority for the prevention of corruption, effective whistleblower protection, and a special prosecutor system.