By Kang Hyun-kyung
Lawmakers will shelve the amendment bill calling for additional compensation for the victims of savings bank fraud amid mounting criticism over the populist measure.
Under the current law, those who have 50 million or more in deposit accounts and victims of bank fraud are entitled to reimbursement of up to 50 million won if the lenders go bankrupt.
Accordingly, those who have more than 50 million won in their savings account cannot receive the remaining amount.
Earlier members of the National Assembly National Policy Committee passed the amendment bill calling for up to 60 percent of reimbursement of the remaining savings if deposits surpassed 50 million won. The bill is now pending in the National Assembly legal committee.
As criticism arose, parties reached the consensus that they should take time to review it thoroughly before sending it to the plenary session to be voted on.
Rep. Hwang Woo-yea of the ruling Saenuri Party said Tuesday that the legal affairs committee will take time to scrutinize the bill as the financial authorities expressed worries over the populist step.
“The justice minister or officials from financial regulatory authorities could be invited to the committee to elaborate their concerns and possible problems,” he said.
Financial authorities oppose the amendment bill, voicing concerns that if passed, it will increase the moral hazards of financial institutions as well as those who deposit their money.
On Monday, President Lee Myung-bak instructed Cabinet ministers to make every possible effort to bar populist bills from being approved ahead of this year’s elections.