How the "Mofia" was born

The word "Mofia" is a synthesis of the words "MOFE" (Ministry of Finance and Economy) and "Mafia." The Mofia is thought to have started under former Minister of Finance Kim Young-hwan. After serving as Director of Financial Affairs in 1966, Kim rose to the positions of undersecretary and secretary, and was followed by the two "generations" of Im Chang-ryul and Lee Hun-jae. There is even talk that it was former Minister Kim who introduced Kim Dae-jung and Lee Hun-jae to each other during the time leading up to the presidential election of 1998. The two men were to have a close working relationship ever since.

Those recently detained by authorities in connection to the Hyundai Motors lobbying incident, including such figures as KDB Partners Representative Woo Byung-ik, Pogo Fund Representative Byun Yang-ho, Korean Asset Management Corporation President Yun Won-young, and Korean Federation of Savings Banks President Kim Yoo-sung, were known to often take meals at the Financial Management Bureau.

During the 1982 bill fraud incident, officials in the Financial Management Bureau of the Ministry of Finance underwent a broad shakeup. In 1994, the Kim Young-sam Government merged the Economic Planning Board and Ministry of Finance, thus giving birth to the Committee of Finance and Economy. As the establishment of economic policy and the execution of finance and taxation procedures were thus carried out under one roof, the span of influence enjoyed by the Mofia widened even further. Internal checks and balances that had been mostly carried out by the Financial Planning Board all but vanished. There are many who observed that the 1997 financial crisis that drove the nation to the brink of default was rooted in this problem.

The Kim Dae Jung government restructured the dinosaur of an organization and separated from it the Ministry of Planning and Budget as well as the Financial Supervisory Committee. There are many who point out that MOFE's rapid change in position from strongly opposing the institution of the Financial Supervisory Committee to supporting it led to exchange and a firm set of ties with the executive office of the Financial Supervisory Committee, thus allowing for the two organizations to 'live under two roofs as one family.'

At the outset of the Roh administration, those scholars with a strong propensity for reform took up camp within the administration, and the sway of the Mofia seemed to falter. However, within two years, the presidential office's line-up of economists was, unsurprisingly, filled with old familiar faces from MOFE.