Arms procurement agency accused of overpaying oil firms

Korea's arms procurement agency made a series of errors in its contract for oil used for military purposes and wasted more than 82 billion won ($72.4 million) of taxpayers' money, the state auditor said Friday.

The Defense Acquisition Program Administration (DAPA) failed to abide by the finance ministry's relevant regulations and took into consideration opinions of the country's four major oil refineries in calculating the basic cost of oil when making a yearly contract with one of them through bidding, the Board of Audit and Inspection said.

By doing so, the DAPA overpaid a combined 50.2 billion won to the companies over the past five years, according to the auditor.

During the period, the procurement agency also wrongfully paid 19.4 billion and 12.7 billion won, respectively, for the refineries' tariff and import fees, which are not covered under the current rule, it added.

The auditor said it notified the DAPA of such errors and asked for clawing back the overpayment.

The DAPA also reportedly failed to carry out performance tests on 176 units of starlight scopes delivered to an Army division last year, some 14.7 percent of which turned out to be faulty.

Some of the body armor given to servicemen also failed to carry out its basic function, and the Army Headquarters in charge of ensuring quality of military supplies does not have specific rules on performance tests and terms of their validity, according to the auditor.

"We've asked the agencies concerned to find ways to ensure quality of such key military equipment, as their malfunction could pose a serious threat to the safety and security of the whole country," an official of the audit agency said. (Yonhap)