Financial companies which drew a relatively high number of complaints from customers will be subject to full-fledged investigations by regulators.
The Financial Supervisory Service said Thursday that it has decided to conduct a large-scale probe into the overall sector including banks, brokerages, credit card firms, insurance firms and savings banks.
This will mark the first time that the FSS will probe the overall financial sector simultaneously in terms of customer complaints over each company, filed with the regulatory agency.
FSS officials said its stern regulatory action comes as dispute cases between consumers and financial firms increased sharply this year.
The number of complaints filed with the FSS came to 47,494 during the first half, up 27.7 percent over the same period last year.
The insurance sector drew the highest number of dispute cases of 22,311, followed by the banking plus non-banking with 22,074 and stock brokerages with 1,964.
In the banking industry, Citibank Korea topped the list as it was responsible for an average of 5.9 dispute cases per 100,000 customers in the first half of 2012.
Others with frequent disputes included the National Federation of Fisheries Cooperatives, Woori and Standard Chartered.
In the non-banking sector, Samsung Card and Hyundai Card drew many complaints. Hyundai Swiss ranked first among savings banks.
Hyundai Life Insurance and Ergo Daum topped the list in the life insurance and non-life insurance sectors, respectively.
In the stock brokerage industry, customers of Kyobo Securities and Kiwoom Securities filed several dispute cases with the FSS.
“Disputes between financial consumers and card issuers included voice-phishing scams and lenders’ blackmailing of delinquent borrowers,” an FSS official said.
“Some firms’ irregular loan issuances yield victims. We cannot tolerate the practices in terms of protection of financial consumers,” he said.
In the wake of their irregular lending, many borrowers saw losses from investing in high-risk funds or now suffer from the burden of paying unnecessary insurance premiums, he said.
He said it seems that financial companies ― both Korean and foreign ones operating here ― have enjoyed easy sales thanks to improper lending.
According to FSS officials, major insurance companies, including Samsung Life and Korea Life, could be the target of close monitoring as to whether they sought unauthorized business activities in coordination with commercial banks.
By Kim Yon-se (
kys@heraldcorp.com)
