Siphoning Off Revenue and Allowance Parties... Local Sports Council Subsidies Leak Out

12 Local Governments Found to Have Mismanaged Over 20 Billion Won

From Subsidy Misuse to Fund Disbursement Without Documentation

Numerous cases have been uncovered in which sports grants, intended to encourage local residents to participate in athletic activities, were mismanaged. Issues included the improper receipt of revenue, misuse of subsidies, and fund disbursement without supporting documentation.

Organizing 50,000 won bills. Photo by Jinhyung Kang

The Anti-Corruption and Civil Rights Commission announced on September 10 that it had investigated 12 basic local governments whose subsidy management and accounting processes were deemed problematic over the three-year period from 2022 to 2024. The investigation revealed that more than 20 billion won in grants were either not managed properly or operated non-transparently. As most sports associations failed to submit supporting documentation such as income and expense statements, the actual scale of unaccounted subsidies is estimated to be even larger. In total, between 2022 and 2024, about 1.5313 trillion won in sports-related subsidies were distributed by 226 local governments nationwide.

According to the standards for managing local subsidies, beneficiaries like local sports councils must declare any anticipated revenue (such as from sports events) in their project plans when applying for grants. However, investigations found that local sports organizations often failed to manage event revenue—such as participant fees collected from athletes—properly, both at the application and settlement stages. Some organizations submitted duplicate evidence for expenses, such as reporting airfare for overseas assignments already paid by parents as if the association had paid, thereby siphoning off about 140 million won. There were also cases where a portion of event revenue was spent in ways unrelated to the intended project, including cash gifts for coaches.

Deliberate embezzlement of grant funds was also uncovered. In one case, a public official overseeing sports grants in a local government engaged in fictitious contracts to falsely disburse funds or inflate grants to cover budget shortfalls. An association secretary-general used a business registration in a family member’s name to fabricate 162 orders for goods, worth a total of about 400 million won, over a four-year period starting in 2022. Elsewhere, a local sports organization was found to have made 96 suspicious purchases relating to competition materials, totaling about 280 million won.

There were also cases where subsidies were spent without any supporting evidence. One local government paid an association subsidies amounting to 860 million won over three years, under the pretense of event hosting fees for national team trials, but could not account for how the funds were actually used. There were also indications subsidies were used for goodwill allowances paid to employees of sports councils or team associations. In one instance, a sports council provided approximately 34 million won as allowances to its president and others without any legal basis, under the guise of wage expenses.

The Commission said it would notify the concerned local governments of its findings and recommend corrective actions such as subsidy recovery. For some criminal cases, such as embezzlement and breach of trust, the Commission will request an official investigation. In addition, the Commission plans to notify relevant ministries to develop institutional improvements for areas where detailed management guidelines—such as for handling project revenue—are insufficient.

This content was produced with the assistance of AI translation services.