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Tax agency inspects KEF over embezzlement, breach of trust
By Lee Kyung-min
By Lee Kyung-min
The tax authorities searched the headquarters of Korea Employers Federation (KEF) in Mapo-gu, western Seoul, Thursday, over allegation that a former senior executive engaged in embezzlement and breach of trust between 2009 and 2017.
The Seoul Regional Office of the National Tax Service (NTS) audited the interest group representing 4,300 businesses nationwide over suspected tax evasion.
The audit followed an investigation conducted by the Ministry of Employment and Labor that found the former KEF Vice Chairman Kim Young-bae spent 190 million won ($168,700) in organization funds allocated for “special expenses,” in buying gift certificates in 2014.
The ministry found that Kim had failed to keep receipts at the time of the purchase nor did he keep expenditure records including where he spent the certificates thereafter.
Kim also received about 100 million won as school expenses for his daughter's overseas studies for eight semesters in what the tax agency considers breach of trust, given the limit is set for 40 million won during that period.
The NTS said Kim may face additional income taxes, if the organization's fund expenditures are recognized as salary.
KEF may be subject to increased corporate tax, for any expenditures not recognized as deductible expenses.