The National Pension Service, the world’s largest public pension, is under fire for its alleged lack of supervision of its staff operating a huge fund after the nation’s top auditor found irregularities.

The Board of Audit and Inspection said some NPS officials were found to have given business favors to brokerages with school background ties in exchange for entertainment and money.

The public agency is found to have given particularly positive feedback to securities firms run by former NPS executives or alumnus, entrusting them to run the pension and allowing them to collect more than 47 billion won ($44 million) in commissions annually.

The inspection report said the agency was found to have made negative assessments of brokerages that tipped off the agency’s wrongdoings to the inspection agency. The case uncovered misconduct at the agency entitled to run more than 350 trillion won in public pensions, which some say has grown “too powerful” over the financial industry.

The inspection agency asked executives involved in the assessment to be removed from their posts, saying “those involved in ranking brokerages and consigning of public pension seriously damaged reputation of the agency.”

The report also found that NPS wasted more than 1.44 billion won as an unnecessary commission paid when purchasing a building named Far East in downtown Seoul.

Calls for management overhaul of the agency are growing as its influence over the market is only expected to grow further.

The agency, one of the largest investors in local stocks, said it will increase its ratio of stock investments from the current 18 percent to 19.3 percent by the end of the year. The fund estimates its total assets will reach 500 trillion won in 2015 and 2,465 trillion won in 2043 to be the largest in the world.

By Cynthia J. Kim (cynthiak@heraldcorp.com)