South Korean Official Stole $342K in Public Funds for Crypto

Fresh evidence has uncovered the full extent of a South Korean civil servant’s scheme to embezzle $342,000 (497.16 million Korean won) in public funds, including vital flood recovery donations, for personal crypto investments.

The unnamed official, referred to as Person A, was sentenced to five years in prison last December for siphoning city budget and public organization funds. However, with the case now under review by the High Court, the ruling could be extended or overturned.

Embezzlement Lasted Six Years, Exposed in Audit Report

While the fraud spanned from November 2018 to May 2023, the full scale of the scheme—including the theft of disaster relief funds—was only revealed in the Board of Audit and Inspection (BAI) report on Tuesday.

South Korea has been grappling with corruption in public office, as seen in the case of former Democratic Party member Kim Nam-guk, who was cleared of charges despite accusations of illicit crypto dealings.

How the Cheongju Official Stole Public Funds

📌 Forged documents and unauthorized use of the mayor’s seal allowed Person A to open a fake bank account in Cheongju City Hall’s name and intercept funds.

📌 The embezzled money was funneled into crypto investments and used to pay off personal debts—likely from failed trades.

📌 Flood relief donations were misused, despite North Chungcheong Province suffering severe flooding in July 2023, which left 49 dead nationwide—19 of them in the province’s capital, Cheongju.

Weak Oversight Enabled the Fraud

The BAI audit found that the official had access to multiple city hall and third-party business seals, allowing him to bypass financial checks and repeatedly divert funds.

🔻 He falsified project expenses and approved unauthorized transactions
🔻 Supervisors failed to verify spending and left the mayor’s seal unattended
🔻 Accounting procedures were poorly managed, allowing fraud to persist

Disciplinary Action Ordered

Following the investigation, the BAI ordered Cheongju City Hall to dismiss the official and take disciplinary action against other implicated officials.

As South Korea faces growing concerns over financial transparency, this case highlights the urgent need for stricter oversight in public funds management—especially amid the rise of crypto-related corruption cases.