Land Minister`s Award Record in Doubt

Land, Transport and Maritime Affairs Minister made eight management consulting service contracts with a certain firm. He has been awarded 11 prizes from the firm and received 400 million won in prize, much larger than his salary.

It all happened when Chung Jong-hwan, incumbent Land, Transport and Maritime Affairs minister, worked as the director of the Korea Railroad Corp. and chief director of the Korea Rail Network Authority. How should it be considered?

According to the ministry and the National Assembly’s Construction and Transportation Committee Thursday, Chung had made four management consulting contracts while working as the director of KORAIL between March 1998 and April 2001. He had made additional five management consulting contracts while working as the chief director of KRNA from April 2003 to December 2006.

For the nine management consulting contracts, he chose the Korea Management Association Consulting eight times and paid 3.7 billion won. The consulting firm has been chosen on private contracts, not open bids.

The number of management consulting requests during his term is far bigger than that of his predecessors and successors. KORAIL director Sohn Hak-rae did it once, Kim Se-ho three times, Shin Gwang-soon once, and Lee Chul twice. And, most of those management consulting contracts were based on open bids.

While working as the KORAIL director and KRNA’s chairman, Chung received 14 prizes from private organizations. Surprisingly, 11 out of the 14 prizes were provided by the KMAC.

He has received 424 million won in prize for three years since 2005. It is far more than his salary.

Some even doubt that whether Chung has been in illegitimate relations with the KMAC where his son has been working since 2004.

However, the minister explained, “I worked with the consulting firm several times in an effort to efficiently run the state-owned firm under my responsibility. No wrongdoing has been made during the process. My son has been also hired by the firm through a legitimate route.”

A source from the consulting firm industry pointed out, “It is an open secret that directors of state-owned firms work with outside organizations like consulting firms in order to improve public recognition of their organizations.”