[fn Editorial] FSC and FSS Should Serve the Public with a Spirit of Service

The Financial Services Commission (FSC) and the Financial Supervisory Service (FSS), which were not affected by the recent government reorganization, have reaffirmed their commitment to strengthening financial consumer protection and organizational reform. On the 29th, the heads of both agencies met and made three pledges: to enhance the protection of financial consumers, to shift toward a field- and consumer-centered approach, and to improve the public interest and transparency of administrative and supervisory processes. The FSS also held a Financial Consumer Protection Resolution Meeting.
There is nothing wrong with the pledges made by the financial leaders or the FSS’s resolution meeting. If they genuinely work for the benefit of financial consumers going forward, nothing could be better. However, it is not surprising that holding a resolution meeting and making promises to the public immediately after defending their existing structure and functions through protests can be seen as a mere show.
It is no exaggeration to say that the FSC and FSS, with their authority to formulate, implement, and supervise financial policies, have long stood above both financial institutions and the public. To financial institutions, this has often felt like bureaucratic control, while the public has experienced neglect in the handling of financial damages. It is hard to deny that both agencies have been criticized for exercising authority without fulfilling their responsibilities.
The government's push for organizational and operational reform stemmed from this background and was well justified. The proposal to separate and strengthen consumer protection functions was widely welcomed by consumers. However, strong resistance from members concerned about the weakening of their organizations and loss of authority ultimately led to the shelving of the reorganization plan.
Currently, the financial sector is in turmoil due to hacking, fraud, Voice phishing (vishing), Smishing, and stock price manipulation, leaving consumers facing significant hardship. Nevertheless, the FSS has been negligent in tracking and eradicating such financial crimes, allowing fraudsters to run rampant. The resulting damages have grown to astronomical proportions. The agencies should take responsibility and publicly apologize to the public.
Toward financial institutions, the agencies have acted from a position of power, dictating terms and assuming the role of the financial prosecutor. They are also responsible for the excessive financial regulations that have prevented Korea’s financial sector from reaching its full potential. Regulation is closely tied to authority, and their reluctance to relinquish vested interests was clearly demonstrated during the recent reorganization process.
Now that the reorganization has failed, the tasks ahead for the FSC and FSS are clear: for consumers, eradicating financial crimes and minimizing inconvenience; for financial institutions, simplifying regulations. This is not the first time the agencies have pledged to work for the public and financial consumers. Repeatedly, these promises have amounted to little more than window dressing.
Holding a resolution meeting and chanting slogans will not earn public recognition. What matters is reorganizing operations to focus on consumers and serving both the public and financial institutions as valued clients. Only by shedding their privileged attitudes and sincerely serving the public will they gain trust and empathy.