From next year, financial firms will be banned from all National Pension Service contracts for up to five years if caught lobbying the service to secure rights to manage portions of its fund, the Ministry of Health and Welfare said Monday.
According to the guidelines unveiled by the ministry to strengthen pension fund management transparency, financial companies will be banned from trade with the NPS indefinitely if they are found to have lobbied three times.
The service will also ban stock brokerages or fund managers from any deals with it for five years if they hire its former employees who underwent heavy disciplinary procedures over fund-related irregularities.
The ministry will make public the criteria for the selection of financial institutions to be commissioned by the NPS to manage part of its fund.
Those NPS employees assigned to fund management positions will be prohibited from stock investment until they are discharged from their jobs. Their family members’ financial activities will also be restricted, said Kim Kang-lip, a ministry official.
The guidelines came after the Board of Audit last month found that NPS employees manipulated assessment results of financial firms to be entrusted with fund management.
“We will encourage and compensate those firms working in good faith, but will show no mercy to those who might hurt the pension fund transparency, since many retired and elderly people rely on monthly payments from the fund,” Kim said.
