Anna Jiwon Park has been covering the politics at The Korea Times since the summer of 2024, when she joined the press pool for the Office of the President in Korea. Prior to that, she spent about five years reporting extensively on financial markets, regulatory authorities and the financial industry. She joined The Korea Times in 2019 after spending eight years as a broadcast journalist at Arirang TV, Korea’s leading global broadcaster, covering politics, defense and culture.
FSS aims to strengthen legal capacity
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By Anna J. Park
By Anna J. Park
The Financial Supervisory Service (FSS) is attempting to strengthen its legal capacity amid increased legal battles with finance companies over its imposition of penalties.
The FSS said Tuesday it recently drew up new internal regulations about legal advisories and lawsuits. Titled “Regulations on legal advisory and lawsuits,” the newly organized internal code of the financial regulator draws together existing separate regulations on the matter into one sorted document.
“Most of the major changes to the internal rules were already amended at the end of last year. The newly enacted internal code drew together several FSS regulations on the topic of legal advisories and lawsuits in one document for the sake of efficiency,” an FSS official explained.
The internal regulations on legal advisories and lawsuits include rules about the agency's available level of legal costs when it comes to appointing external legal counsels. The FSS stipulated the increase to the limit of its legal costs paid to legal counsels during a rules revision made last December. With the increased legal fees made available this year, it is expected that the financial watchdog will be able to assign competent law firms with more ease.
The FSS code limits its payments to counsels to 40 million won ($31,000), yet it could be raised within 50 percent of the cost, depending on a legal case's unique features and complexity. The internal rules also include an exception that the payments could rise to 100 million won, with approval from the FSS chief, if a lawsuit is expected to have a huge impact on the agency.
The code also has a provision that stipulates the possibility of sharing legal costs with the Financial Services Commission (FSC), the country's top financial regulator.
The FSS lost a series of legal battles against financial companies last year and early this year. It has been frequently observed since last year that FSS' imposition of penalties on key management officials of financial companies over various types of financial accidents were met with legal challenges from the companies so as to invalidate the penalties.
Employing several expensive top-notch law firms, financial companies tend to wield stronger legal prowess at trials, defeating the FSS in many legal cases. As the nature of financial legal cases is complex and complicated, the FSS' limitation in legal costs had been pointed out as one of the reasons for its defeats in a number of trials.