South Korea uncovers 38.6 billion won in misappropriated sports industry loans

The South Korean government has uncovered widespread misuse of low-interest loans intended to revitalize the sports industry. An investigation by the Office for Government Policy Coordination and the Ministry of Culture, Sports and Tourism revealed 117 cases of improper fund execution totaling approximately 38.6 billion won.

Key findings include 13 cases (14.2 billion won) where funds meant for sports facilities were diverted to operate hotels, academies, or left in vacant buildings. In one instance, a business owner allegedly forged tax invoices to operate a hotel using funds borrowed for a screen golf facility. Other violations included submitting fraudulent evidence, such as personal credit card statements from hospitals or entertainment venues, and using loan funds for personal salaries or rent.

The investigation highlighted systemic management failures within the Korea Sports Promotion Foundation, which relied heavily on bank-led loans and conducted field inspections for only about 5% of total loans. In response, the government plans to recover 13 billion won and request criminal investigations into cases involving forgery. Future reforms will include shifting to a direct management system by the Foundation, implementing external accounting audits, and introducing support measures for non-golf sports sectors.