Public home-shopping channel bypassed product vetting on 247.4 billion won in sales

Public Home Shopping has in effect stopped operating the broadcast product verification committee it created to screen products for air eligibility, an audit released Friday showed.

Products that regulations require to pass committee review were broadcast without going through the process, and the consumer product evaluation committee was also found to have been run in violation of its own rules. The Ministry of SMEs and Startups recently published a special audit report on Public Home Shopping, disclosing the findings.

The audit was conducted to verify allegations raised during last year's national audit in the National Assembly that the broadcast product verification committee had been poorly run. The ministry began the audit in January and examined the overall operations of 23 committees within Public Home Shopping, covering the period from 2023 through last year.

Public Home Shopping established the broadcast product verification committee in 2019 to set clear criteria for determining whether products could air. Under its operating guidelines, products made domestically using imported raw materials and overseas travel packages offered by small domestic travel agencies must go through committee review. Only products that pass verification may be submitted to the consumer product evaluation committee.

The audit found, however, that the committee met just once over the past five years. In the interim, products that regulations required to be verified were broadcast after passing only internal review sessions and the consumer product evaluation committee, with no stated justification for skipping the mandatory step.

Over the past three years, 274 products made domestically from imported raw materials — with combined sales of about 93.6 billion won ($60.2 million) — were sold without committee verification. An additional 459 travel products worth about 153.8 billion won were broadcast without going through the process. Combined, the 733 cases represent 247.4 billion won in sales.

The Ministry of SMEs and Startups said the committee exists "to review in advance the appropriateness and validity of broadcast products that Public Home Shopping can handle," adding that "arbitrarily omitting this process risks undermining the objectivity and fairness of product selection." The ministry ordered the company to overhaul its broadcast product operating standards and issued an institutional warning.

The consumer product evaluation committee — the top decision-making body for product selection — was also found to have operated poorly. Of 156 meetings held between January 2023 and January this year, the committee chair was absent from 113. Internal members were missing from at least 50 meetings, and in 15 cases the chair and all internal members were absent, leaving the committee to function with only outside members.

Fees paid to outside committee members also deviated from regulations. The audit found that payment standards were applied arbitrarily between 2023 and 2025, resulting in overpayments totaling 14.92 million won.

Public Home Shopping has long faced recurring controversy over internal controls and governance. Since 2018, internal audits have flagged problems with partner management and fairness in product operations, prompting management reform drives. Disputes over management, personnel and broadcast operations have continued since, and this latest audit confirmed that the various committees meant to serve as internal-control mechanisms were not functioning properly.

Regarding the findings, Public Home Shopping said it "accepted most of the issues raised during the audit process" and pledged to "strengthen product selection criteria, clarify step-by-step verification procedures, and improve committee attendance management and fee payment standards."