Startup Drew Funds With Fake Sales, Thin Documentation Government Failed to Catch It, Sought Probe Only After Project Ended Criticism Mounts Over Oversight of Tech Startup R&D Programs Only 6.9% of Clawback Decisions Including TIPS Actually Recovered Rep. Choi Soo-jin: Agency Must Show Accountability, Recovery Plan
The South Korean government provided 500 million won (about $360,000) in research and development funding to a startup through TIPS, a private-led tech startup support program, and failed to detect that the money had been wrongfully obtained until the project was completed, according to data obtained by a lawmaker. Clawback decisions worth more than 13 billion won have been issued since last year under government programs that include TIPS, but only 6.9% of that amount has actually been recovered, fueling calls for a full review of the oversight system.
Data submitted by the Korea Technology and Information Promotion Agency for SMEs (TIPA) to Rep. Choi Soo-jin of the People Power Party, a member of the National Assembly's Trade, Industry, Energy, SMEs and Startups Committee, showed on the 15th that the startup in question secured 200 million won in early-stage investment from a TIPS operator on the basis of falsified sales figures, then received 500 million won in government R&D funding in four installments.
Under TIPS, private operators evaluate a startup's technology, growth potential and sales, invest in the company first and then recommend it to the...
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