Lawmaker introduces bills to curb credit union leadership's unchecked power

Rebuilding Korea Party lawmaker Shin Jang-sik announced July 2 that he would introduce amendments to the Credit Union Act — a two-bill package aimed at improving governance and strengthening internal controls at credit unions.

The legislation is intended to bring credit unions in line with standards already applied to other mutual financial institutions.

At a press conference that day, Shin said the amendments would introduce three key measures to ensure sound management at credit unions: granting members the right to demand the dismissal of executives, seek injunctions against unlawful acts, and file representative lawsuits; recognizing directors' right to propose agenda items to guarantee board independence; and giving audit and supervisory directors independent representative authority to secure oversight powers.

Shin cited the lack of checks on credit union management compared with other mutual financial institutions as the driving force behind the bills.

"Agricultural cooperatives, fisheries cooperatives and forestry cooperatives apply the Commercial Act, giving members mechanisms to demand the dismissal of executives, file representative lawsuits and block unlawful conduct," Shin said. "The Saemaul Geumgo also recognizes directors' right to propose agenda items — yet credit unions lack even these minimal checks." He argued that unchecked executive authority ultimately harms members' rights and interests.

Shin also said securing the independence of audit and supervisory powers was essential for stronger internal controls. "In the case of agricultural cooperatives, the cooperative audit committee holds independent audit and representative authority, but credit unions have no such system, leaving them vulnerable to the influence of the central association president," he said, stressing the need for reform.