Parliament approves set of laws to crack down on property speculation by public officials

The National Assembly approved Wednesday a set of legislation aimed at cracking down on illegitimate real estate speculation by public officials as the country has been roiled by an ongoing land speculation scandal involving the state housing developer.

Three bills got the parliamentary nod during a plenary parliamentary session earlier in the day, to revise the Korea Land and Housing Corporation (LH) Act, the Public Service Ethics Act and the Special Act on Public Housing.

A logo of Korea Land and Housing Corporation. Yonhap

The initiatives seek to eradicate public officials' illegitimate real estate transactions based on secret land development-related information they gleaned while working for the government.

The government is currently facing a public backlash over a growing land speculation scandal involving officials of the state housing developer, LH.

The scandal, which centers on allegations that employees of the state-run firm used insider information to make speculative land purchases on public housing development sites, inflamed public outrage at a time the government is struggling to rein in skyrocketing housing prices.

Under the revision of the Special Act on Public Housing, a public official who sells or buys real estate based on insider information concerning state-led land development projects or who leaks such information to other people will be subject to a five-year imprisonment at maximum or a fine amounting to up to five times the financial profits gathered from the speculative transaction.

If the profits exceed 5 billion won ($4.4 million), the sentence could go up to life imprisonment, according to the revision.

The revised LH act enables the confiscation of financial profits gleaned by current LH employees, and former employees who worked for the company in the past 10 years, through real estate deals based on insider information.

In addition to confiscation, they could also face up to a five-year imprisonment or a fine amounting to as much as five times the profits they pocketed through illegitimate property transactions.

The revision to the Public Service Ethics Act expands the compulsory asset declaration requirement, currently applicable only to high-ranking public officials, to cover not only LH employees but also other lower-level government officials engaged in real estate-related assignments, such as those who work for municipal offices or other government agencies on land development.

The revision can also restrict them or their partners from acquiring real estate that falls within the realm of the public officials' assignments. (Yonhap)