LH employees draw fire for buying public housing intended for underprivileged families

SEOUL, The state-run Korea Land and Housing Corp. (LH) has again come under fire for controversial property speculation, as a civic group alleged Monday that nearly 1,400 LH employees have earned a huge profit over the past decade through their dubious purchases of public housing units intended for low-income non-homeowners.

The civic group People's Solidarity for Participatory Democracy (PSPD), citing data from an opposition lawmaker, said 1,379 LH employees have bought 1,621 public housing units in the last 10 years, logging at least 333.9 billion won (US$300 million) in net property price increases.

Each of the public housing units, sold to LH employees for 220 million won on average over the past decade, was worth 460 million won apiece as of the end of April, marking a net profit margin of 240 million won per unit, the civic group said.

In South Korea, public housing units have been built on government-provided land by LH and other government-contracted companies to supply affordable housing to low-income non-homeowners, people of national merit, the disabled, newlyweds, multi-child families and other underprivileged households.

The biggest profit gains were reported from a southern Seoul apartment complex named Segok Prugio, where five LH employees each bought public housing units for 300 million won in 2011 and their market prices soared to 1.5 billion won apiece this year.

A total of 15 LH employees bought public housing units at the five most profitable apartment complexes nationwide and gained an average price increase of 1.08 billion won, the PSPD asserted.

LH workers' public housing purchases mostly occurred in a new administrative new town in Jinju, 435 kilometers southeast of Seoul, where the LH headquarters are located. About 450 LH employees are believed to have logged housing price gains worth 69.3 billion won after buying LH-built public housing apartments in Jinju, PSPD alleged.

The civic group then called for a thorough investigation into all public housing purchases involving LH employees to see if any illegality was committed, while LH argued that its employees have signed all contracts legitimately after securing valid qualifications to move into public housing units.

Some LH employees' controversial purchases of public housing came to light after the PSPD and other civic groups accused 14 LH employees two months ago of purchasing land in the capital area based on insider information.

So far, one LH employee has been arrested for using insider information to buy land ahead of its development and several dozens of other employees suspected of being involved in illicit land purchases are under probe.

The scandal has also spilled into other public agencies, with hundreds of public servants, including several sitting lawmakers, under investigation for speculative real estate transactions using classified information.

Source: Yonhap News Agency

You may also like...