Broker in 'MFDS Solicitation Allegations' Caught for False Ads Misleading Products as Medicine

It has been revealed that a broker surnamed Yang, a key figure in allegations of soliciting the Ministry of Food and Drug Safety (MFDS) regarding a COVID-19 treatment tied to Justice Minister nominee Kim Seung-won, was previously caught by the MFDS for false advertising while running a cosmetics business.

In 2014, Yang founded Gusta, a distributor and seller of feminine care products and cosmetics.

According to the office of Representative Han Ji-a of the People Power Party, the MFDS caught Gusta Co., Ltd., operated by Yang, for false advertising in November 2020 and issued a suspension of its advertising operations in February 2021.

The action was taken because Yang falsely advertised two products—"Pielsana Fine Spring Day Nourishing Hand Cream" and "Inner Pink Pure Foam Cleanser"—as if they possessed medicinal efficacy.

Specifically, the MFDS determined that Yang advertised the foam cleanser on social media and other platforms with claims such as "proven antibacterial efficacy" and "effective in alleviating inflammation," but actually engaged in false advertising that led consumers to mistake it for medicine without possessing supporting evidentiary data.

At the time, the products were also distributed to military supermarkets (PX), and some media reports revealed that Yang made solicitous remarks to military officials and others the following year, in 2022, to have the company's products supplied to military stores.

On October 30, 2024, three years after the MFDS sanction, Yang closed Gusta Co., Ltd., and sales of the products have since been discontinued.

An MFDS official explained, "Cosmetics do not require regulatory review procedures such as licensing or approval, but if sold as functional cosmetics, safety and efficacy evaluations must be conducted for each item. In Gusta's case, none of the products were reviewed even as functional cosmetics, and the company was caught for advertising that misled consumers into mistaking them for pharmaceuticals."

Representative Han Ji-a of the People Power Party, a member of the National Assembly's Health and Welfare Committee, stated, "A businessperson who received sanctions from the MFDS for false advertising has reappeared in the MFDS approval process for a new drug." She added, "This is not something that can be dismissed as a coincidence. We will thoroughly uncover during the regular session of the National Assembly who asked what of whom, and how they approached the MFDS."

Representative Han plans to summon Yang as a witness regarding the false advertising during the parliamentary audit scheduled for October.

Yang is suspected of receiving 600 million won from Kang Se-chan, head of drugmaker Genencell, in October 2021 as compensation for lobbying the MFDS through nominee Kim.

Prosecutors indicted Yang on charges including violations of the Attorney-at-Law Act, and Yang is currently on trial in the first instance.

Yang denies all allegations, including the drug agency lobbying suspicions, maintaining that the 600 million won in question was "a legitimate investment received from Kang."

(Photo: Yonhap News)
※ Please note: This article was translated by AI and may contain errors.