Social Insurance Agency update…. June 14, 2006Posted by fukumimi in Economy & Business, Japan.
An update on the scandal surrounding the Social Insurance Agency that has been covered in a previous post.
The 2nd report by the Social Insurance Agency now reports more than 210,000 cases where exemptions were processed irregularly, to boost contribution rates statistics.
Offices in 36 of the 47 prefectures have reported that they have found cases of inappropriate procedure.
In the press conference the SIA admitted that there may have been an attempt to conceal the magnitude of the problem when the interim numbers were reported.
I suspect the numbers will rise even more when the final report is released.
The Social Insurance Agency has more than 17,500 employees according to the most recent published figures. For each SIA employee, there were a dozen falsified applications. 80% of which are deemed to be illegal. There are cases of employees signing paperwork, when the applicant's signature/stamp was required. That is a pure case of fraud and forgery of official documents.
Each and every employee found to have played a role should be prosecuted.
The contributions shortfall is estimated to be approx JPY30B, or JPY1,500,000 for each and every employee. Maybe they should pay out of their own pockets if they are not going to prosecute individual employees.
The government has been making a big thing about the fact that the head of the SIA was recruited from the private sector. This individual, Kiyoshi Murase, was previously a representative director at Sompo Japan.
Sompo Japan is currently serving a ban imposed by the FSA which prevents them from seling or marketing its insurance products for 2-4 weeks. The ban resulted from the discovery of cases where the company was witholding insurance payouts in nearly 30,000 cases totalling more than $10M without due cause, and also assuming payment of life insurance premiums to inflate contract numbers. (Admittedly, pretty much all of the major insurance companies were found to have been witholding payment, but in Sompo Japan's case, the FSA imposed a severe penalty based on repeated and flagrant violations of the insurance laws, citing 5 different types of violation including the 2 described above.)
Whilst I am all for bringing _good_ private sector people into manage public institutions, the SIA sure knows how to pick 'em.