[Edaily Marketin JI YEONG-EUI Reporter] The Fund Management Division of the National Pension Service (NPS), which manages 1,900 trillion won in national retirement funds, will convene a disciplinary committee in the near future regarding the former head of the Real Estate Investment Division, who has been placed on administrative leave. Amid allegations that have persisted for several years—including claims that he used his authority over massive investment decisions to interfere in the personnel matters of external asset management firms and exert undue influence on relevant parties—it is understood that the related audit is nearing completion.

According to a synthesis of reports from the investment banking (IB) industry and E-Daily on the 27th, the National Pension Service plans to convene a disciplinary committee within a few days regarding former Real Estate Investment Division Director Ahn Mo (a senior-level portfolio manager in the Real Estate Investment Division). The NPS Audit Office has been conducting an audit based on anonymous letters and tips related to the Real Estate Investment Division. While the audit is nearly complete, the specific level of disciplinary action sought has not yet been finalized.

A Series of Controversies Over Poor Investments and Hiring Solicitation… Criticism of the Private Use of Citizens’ Retirement Funds

The NPS Real Estate Investment Division, led by former Director Ahn, has been embroiled in a series of controversies surrounding personnel appointments at external asset management firms and investment decision-making. He is suspected of misusing the National Pension Service’s powerful investment authority for personal gain, pressuring the replacement or dismissal of management firm CEOs or executives, or demanding the hiring of specific individuals who suited his preferences. Complaints also continued from employees in the asset management industry who alleged they were subjected to verbal abuse and personal attacks—or were barred from entering the National Pension Service’s premises—when they refused to comply with his demands.

In particular, conflicts of interest involving specific asset managers came to light in an investment deal involving hundreds of billions of won of the National Pension Service’s funds. The National Pension Service’s Real Estate Investment Division pushed to replace the general partner (GP) for Seoul’s Yeoksam Centerfield—a property with assets worth around 4 trillion won—from Aegis Asset Management to Koramco Asset Management, but the proposal was rejected by the Alternative Investment Committee. Not only was this an unprecedented and reckless attempt at a management change in the history of the National Pension Service’s fund management, but a conflict-of-interest controversy also arose when it was revealed that a former high-ranking official of the National Pension Service had moved to a position as the head of Koramco’s Jeonju office shortly after retiring.

The investment process for the “The Exchange Seoul” development project in Mugyo-dong, Jung-gu, Seoul, in 2024 also sparked controversy. The National Pension Service invested 252 billion won, equivalent to 92.6% of the total equity. Although internal opposition was raised at the time due to development risks and profitability concerns, the investment was ultimately approved. In conjunction with this investment, an individual with a history of working alongside senior officials from the NPS Real Estate Investment Division at Samsung Securities was hired through a mid-career recruitment process at Koramco Asset Trust, the project manager. This led to allegations that senior officials from the NPS Real Estate Investment Division had engaged in “abusive hiring pressure” toward Koramco.

Both the National Pension Service and Koramco have denied these allegations. The National Pension Service maintained that the investment proposal was reviewed in accordance with internal regulations and procedures. Koramco also explained that there was no interference in the hiring process and that it had implemented information-blocking measures to exclude the former National Pension Service official from related duties.

Controversy also arose over an investment in Hong Kong office properties that were classified as distressed assets. The National Pension Service increased its total investment in “Tower 535,” located in Causeway Bay, Hong Kong—a property that had defaulted—to approximately 1.2 trillion won by injecting an additional 900 billion won in September 2025, on top of the existing investment of about 250 billion won. Although internal opposition was raised due to the slump in the Hong Kong office market and the potential for mounting losses, the additional investment proceeded. It has been reported that, despite a significant recovery in occupancy rates since then, the rate of return remains extremely low. Consequently, criticism arose that, due to private interests tied to the asset manager, 1 trillion won of the public’s retirement funds had been tied up in low-yield, non-performing assets.

"Resolving the Real Estate Investment Division Issue Is a Litmus Test for the National Pension Service’s Ability to Self-Regulate"

Industry observers assess that, given the prolonged controversy surrounding

the Real Estate Investment Division

, this disciplinary process will serve as a litmus test for the National Pension Service’s Fund Management Headquarters’ ability

to self-regulate

.

In particular, there are calls to view the Real Estate Investment Division issue not as a matter of individual misconduct but as a problem of internal controls, and to implement reforms accordingly. The National Action for Strengthening Public Pensions—a coalition of some 300 organizations, including the Korean Confederation of Trade Unions (KCTU), the Federation of Korean Trade Unions (FKTU), and People’s Solidarity for Participatory Democracy—recently urged Lee Kyu-hong, the newly appointed Chief Investment Officer (CIO) of the National Pension Service, to implement reforms. The group raised issues such as hiring fairness within the Real Estate Investment Division, abuse of power and harassment toward asset management firms, and the appropriateness of domestic and international real estate investments.

The National Action for Strengthening Public Pensions pointed out that the response should not be limited to disciplinary action against specific individuals; rather, internal controls and whistleblower protection systems must be strengthened, and the Fund Management Committee’s substantive oversight functions must be enhanced to prevent similar problems from recurring.

Pension Action emphasized, “The issue involving the head of the Real Estate Investment Division demonstrates a structural failure of internal controls within the Fund Management Headquarters,” adding, “The essence of this matter is to improve the internal control system and the whistleblower protection framework, and to strengthen the substantive oversight functions of the Fund Management Committee to prevent the emergence of a second or third person like Division Head Ahn, who could undermine trust in the fund and the system at any time.”

An official from the investment banking industry pointed out, “If the National Pension Service isolates only certain issues and handles them by ‘cutting off the tail,’ won’t there inevitably be a move to file a complaint with external investigative agencies?” The official added, “If problems that could not be uncovered internally are later revealed by investigative agencies, that would actually be an even greater disgrace for the National Pension Service.”