Data leak turns PM nominee's flagship startup program into liability

The Ministry of SMEs and Startups is scrambling to contain the fallout from a personal data and business idea leak in its flagship "Modu-ui Changup" ("Everyone's Startup") program. Earlier this month the ministry awarded a task force 37 million won ($24,100) in prize money to celebrate the program's success — but the mood reversed in less than a month. The program had been a key achievement credited to Minister Han Sung-sook before her nomination as Prime Minister, and the mismanagement is now generating serious backlash.

The ministry has issued four separate apologies over the leak. It first posted a notice on its website June 18 apologizing to program finalists, then issued a second apology the following day through a statement by ministry spokesperson Kim Ji-hyun. On Monday morning, Minister Han personally bowed in apology, and that afternoon First Vice Minister Noh Yong-seok followed with another public bow. The ministry said it would provide all 5,000 finalists with free registration of original trade secret certificates, technology escrow services, and consultations with specialist lawyers to protect their ideas.

Despite the repeated apologies and protective measures, public sentiment remains cold. Particularly hard hit are those who spent years developing ideas and submitted them in response to the government's promise to nurture startups. What finalists find most alarming is that summaries of their ideas and evaluators' feedback were also exposed. Among applicants, there is broad consensus that evaluators' comments are not mere opinions but core business assets — containing direction, strategy, and competitive insight.

One finalist whose personal data was leaked said early-stage startup ideas, even without a completed patent or product, "are business assets that contain problem definitions, target customer groups, solutions, and market approaches." The person warned that external exposure "could put us at a competitive disadvantage and affect investment and collaboration opportunities."

Critics say the ministry's complacency allowed the situation to escalate. With an AI solutions firm identified as the source of the leak, questions have also emerged about inadequate vetting of partners — and the fact that an advance warning went unheeded has drawn particular criticism.

Team Zento — a security startup founded by Yonsei University alumni who were also first-round finalists in the program — flagged the risk of a personal data leak on May 7. The team develops solutions for identifying and addressing security blind spots. During a security diagnostic, they discovered a platform vulnerability in which personal data from "Modu-ui Changup" was being exposed in structured form through API responses, and reported it to the program's operators. The information exposed at the time included one-line summaries of roughly 16,000 ideas and the private profile data of more than 8,000 team members.

In a phone interview, Team Zento said the core issue was "a structural problem in which a publicly accessible API was returning excessive data," adding that "if the list API responses had been minimized a month earlier, the possibility of bulk collection by the same method could have been significantly reduced."

Regarding the warning, the ministry said the platform developer had failed to report the matter up the chain. Vice Minister Noh said at a briefing Monday that "the tip was received and the platform developer immediately blocked access at the time," but that "the developer handled it internally and did not report it to the ministry or the Korea Entrepreneurship Foundation." He added that the ministry would "hold the developer accountable for the failure to report, following a legal review."

The ministry had touted the program's achievements — awarding the task force 37 million won ($24,100) in prize money earlier this month — but mismanagement has turned it into a liability. With Minister Han now nominated as Prime Minister, she is expected to face a barrage of questions at her confirmation hearing scheduled to begin June 25.

The People Power Party has already signaled an aggressive line of attack. PPP lawmakers Kang Seung-gyu, Kim Hee-jung, and Jo Jeong-hun, all members of the special confirmation hearing committee, held a press conference Monday at the National Assembly press center, calling Han an "unsuitable candidate" and demanding that President Lee Jae-myung withdraw her nomination. On the data leak, they criticized Han for "poorly designing 'Modu-ui Changup' as SMEs minister and causing great harm to young people."