South Korea's meal card system for needy children plagued by fraud and misuse

A joint investigation in South Korea has uncovered significant mismanagement and misuse of meal cards intended for underprivileged children. The probe revealed instances where these cards were used for purchases unrelated to meals, including alcohol, tobacco, and daily necessities, raising serious concerns about the program's integrity.

One case involved a parent who allegedly made fraudulent transactions totaling over 12 million won (approximately $9,000) by repeatedly using their child's daily limit at their own snack bar. Another parent was found to have purchased cigarettes and non-essential items like detergent and tissues using their child's card. Analysis of usage data from 182 local government areas showed approximately 1.25 billion won (about $930,000) spent on categories unrelated to meals, with cafes accounting for the largest portion.

Compounding the issue of misuse, a substantial amount of meal card funds remains unused. An estimated 17.1 billion won (around $12.7 million) in loaded funds has expired, representing 7.8% of the total charged amount. The government attributes this underutilization to the social stigma associated with using the cards and a lack of clear guidance on their usage. Over 4,800 cards were found to have less than 10% of their loaded value used.

Further systemic flaws were identified in the management of card issuance and eligibility verification. In some regions, children were not registered in the central welfare system, allowing parents to continue using meal cards even after a child was placed in protective care or, in one tragic instance, after the child's death. The government has announced plans to strengthen the system by expanding restrictions on prohibited items like alcohol and tobacco to all supermarkets, limiting merchant registrations for establishments like bars, and improving the notification system for changes in a child's status.

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The government will expand the system to block payments for prohibited items like alcohol and tobacco, currently applied to convenience stores, to general supermarkets.