An increasing number of high-level posts in the finance industry are being occupied by the so-called political mafia in the country, raising questions about their suitability and expertise.

Around 50 people are known to have been appointed to high-paying financial sector jobs on the strength of their political connections during the Park Geun-hye administration, leading to the coining of a new term, “jeongfia.” The first syllable refers to connections with politicians and the second to the mafia, the Italian criminal organization.

According to reports, seven CEOs, 12 auditors and 28 outside board members of local financial organizations were “parachute jumpers” who came from political circles. 

The latest example is Woori Bank vice president Lee Kwang-goo, who was named the bank’s new chief last week.

Lee was already a promising candidate even before his appointment ― not because of his expertise or abilities, but because of his ties to high-ranking government officials in the financial sector from his alma mater, Sogang University.

“For people in this (finance) world, it’s an explicit truth that Sogang graduates have a bigger voice and presence these days than in the past. It’s largely because President Park Geun-hye is also a graduate of the school,” a former high-ranking official at the Free Trade Commission said, wishing to remain anonymous.

Another high-ranking financial sector individual suspected of being a member of jeongfia is KDB Financial Group chairman Hong Ky-ttack, who was part of President Park’s think tank and the Commission on Presidential Transition.

Former Woori Bank president Lee Duk-hoon was also lambasted after taking office as chairman of Korea Eximbank in March. He is known as a key figure in the group of Sogang graduates within the finance industry.

The problem of hiring jeongfia members is that because some are not well suited or qualified for the jobs, their leadership often leads to corporate malfeasance or negligence, industry observers have noted.

“The jeongfia are known for ‘three zeros.’ Zero experience, zero principle and zero order,” Financial Consumer Agency president Cho Nam-hee said, stressing the risk of hiring such personnel.

South Korea experienced repercussions from a similar phenomenon when the Seoul ferry sank in April in a deadly accident. As many of the officials overlooking the situation were former public sector officials with no real qualifications or expertise, the situation quickly turned from bad to worse.

Despite the president’s pledge to root out the bureaucratic mafia, the government has so far failed to stop the long-standing practices. Now the jeongfia has emerged as yet another powerful sect in the country.

By Suk Gee-hyun (monicasuk@heraldcorp.com)