[E-Daily Reporter KIM HYUNG-HWAN ] A court has ruled that recovery organizations established to address the damage from the 2007 Taean, South Chungcheong Province, oil spill must return 280 billion won after it was revealed that they had misused funds—including using them to pay salaries and cover operating expenses.

According to legal circles on the 10th, the 31st Civil Division of the Seoul Central District Court (Presiding Judge Nam In-su) recently ruled in favor of the plaintiff in part in a lawsuit filed by the Community Chest of Korea against the West Coast Federation Foundation and the Hebei Social Cooperative, seeking the return of distributed funds. The court ordered the West Coast Federation to pay approximately 110 billion won and the Hebei Social Cooperative to pay approximately 185 billion won to the Community Chest of Korea.

Previously, in December 2007, a massive crude oil spill occurred off the coast of Taean County, South Chungcheong Province, when a Samsung Heavy Industries crane ship collided with a Chinese-flagged oil tanker. In response, Samsung Heavy Industries donated 290 billion won to the Community Chest of Korea in February 2016 as a regional development fund.

Consequently, groups representing affected residents established the West Coast Federation and the Hebei Social Cooperative using these funds to carry out public interest projects, such as revitalizing the local economy. However, allegations later arose that the Federation and the Cooperative were not properly managing the allocated funds, leading to audits by the Ministry of Oceans and Fisheries and the Board of Audit and Inspection. The audits revealed issues such as the improper use of funds for executives’ and employees’ travel expenses and delays in convening the General Assembly of Delegates.

Consequently, in August 2023, the Fruit of Love notified the two organizations to return the remaining allocated funds, but they contested the decision, leading to litigation.

Fruits of Love pointed out that, as of the end of 2021, the Federation’s cumulative expenditure totaled 4.6 billion won—a mere 4.4% of the total allocated funds—and that 3 billion won of this amount was spent on institutional operating expenses, such as salaries for executives and staff. Furthermore, the Foundation argued that, at the same point in time, the Cooperative’s cumulative expenditure totaled 15.8 billion won—7.8% of the total—and that 9.4 billion won of this amount was used for institutional operating expenses.

The court explained the rationale for its ruling in favor of the plaintiff, stating, “It appears that the foundation has been operated in such a way that executives and employees have been using interest income generated from the allocated funds to cover personnel expenses and other costs, rather than completing the intended projects within the project period.”