[Reporter`s View] Dangerous words of bureaucrats

Recently, LG Group had to struggle to calm rumors that it is suffering from a financial crunch. An official of the group, who was involved in doing so, still is displeased about an official of the Financial Supervisory Commission (FSC), which is considered to be the source of the rumor.

The FSC official said that LG Group has no problem in mid-October, but that sparked the rumor about an LG crisis. The remark about LG Group by a high-ranking FSC official, shortly after settling the Hyundai debacle, caused a delicate wave in the market.

Rumors spread in the financial market that LG Group also was suffering from financial trouble, so the FSC threatened that it would punish dearly those who spread the rumor, if they are caught, saying that it is a false rumor.

However, LG showed a cold response to that. LG officials said that it is like triggering the cause and trying to cure it.

"If there is no problem, the FSC shouldn't mention it,¡± a group official said. ¡°The FSC's clumsy remarks dealt a severe blow to our group."

Also, a representative of a domestic mutual savings firm blamed senior presidential economic secretary Lee Ki-Ho, who said that a couple more mutual saving firm scandals would occur. With his remarks, mutual savings firms faced difficulty in attracting deposits from customers.

The release of Ford Motor' bidding amount by former FSC chairman Lee Yong-Keun in the open bidding for sale of Daewoo Motor still is burdensome to the Korean economy. A company official, who is familiar with international negotiations, contended that the deal was broken at the very moment he disclosed it.

Corporate executives point out that the reason why such verbal lapses are continuing is that the government officials want to demonstrate that they are conducting important tasks.

"In a country like Korea, where bureaucrats are so powerful, their verbal lapses are just like a false posting of company actions in the stock exchange,¡± said Lee Seung-Cheol, Assistant Secretary General of the Federation of Korean Industries. ¡°The companies are punished for that false posting, but the officials are not held accountable for it, although it hit hard companies or financial institutions."