SEOUL—A South Korean organization that helps women who were forced into sexual slavery for the Japanese military during World War II has come under scrutiny in recent weeks for some of its financial dealings, in another twist to the long and painful saga of the so-called “comfort women.”

One of the few remaining survivors of this wartime slavery, 91-year-old Lee Yong-soo, accused the organization of using the survivors and their stories to collect public donations but spending the money on things that don’t actually benefit the victims.

Lee presented no evidence against the group, known as the Korean Council for Justice and Remembrance for the Issues of Military Sexual Slavery by Japan. But her remarks served to reopen an old war wound that still mars relations between South Korea and Japan.

They also triggered investigations into the Korean Council by news sites, one of which reported that the organization purchased a two-story house in 2013 for well above market price. The house has since been sold at about half the purchase price.

The Korean Council has admitted to “accounting errors” but has denied allegations of embezzlement and misappropriation.

“We believed that the Korean Council represented the victims’ position. However, Ms. Lee’s comments made it clear that it is not the case. Now we are not sure what to believe and what we must do to solve the historical problem,” Choi Eunmi, an associate research fellow at the Asan Institute for Policy Studies, told Foreign Policy.

She said the ordeal could make it more difficult for South Korea to negotiate a long-delayed settlement to the sexual slavery issue with Japan.

The two countries reached a tentative agreement in 2015, calling on Japan to pay 1 billion yen (around $9.3 million), issue a formal apology from Japan’s prime minister, and accept “deep responsibility” for the issue. The deal heralded a new era in relations between South Korea and Japan.

But it fell through after South Korean President Park Geun-hye was ousted. The current president, Moon Jae-in, has rejected the terms, saying the negotiations were conducted without input from the victims and the Korean public.

Precisely how much negotiating is underway at this moment is unclear. Last year, the speaker of South Korea’s parliament suggested a solution that involved collecting donations from both countries that would go to the victims of sexual slavery and forced labor. But the proposal drew public criticism and is unlikely to pass when the parliament reconvenes in June.

Some in Japan have portrayed South Korea as too heavily focused on the financial aspects of any possible deal. The scandal surrounding the Korean Council could sharpen that perception.

“Of course the Japanese right-wing crowd is all over the story about badly used funding at the Korean Council. After all, this view in Japan has always maintained that the Koreans are in it only for the money,” Alexis Dudden, an expert on Japan-Korea relations at the University of Connecticut, told Foreign Policy in an email.

The conservative Japanese newspaper Sankei Shimbun has highlighted the story on its pages, referring to the Korean Council as sharply anti-Japanese.

The scandal remains mainly a domestic issue. But the history it invokes has a way of infecting contemporary relations between the two countries.

When a South Korean court fined Japanese companies in late 2018 for forced labor practices during World War II, Tokyo imposed export restrictions on certain goods used primarily in South Korea’s semiconductor industry. In response, Korean civil society groups encouraged businesses to boycott Japanese companies.

The coronavirus has given the two countries another issue to fight over: travel restrictions. South Korea suspended visa-waiver programs with Japan in response to the pandemic. Tokyo responded by banning entry to people flying in from South Korea.

“It’s bad, and in these three or four years, the relationship has gotten worse. And of course … regional peace is closely related to the governments’ relationship,” said Lee Mi-hyeon, an activist at a weekly protest outside the Japanese Embassy in Seoul.

Even gestures of kindness have ended up creating tension. This month, a city government in South Korea’s North Gyeongsang province sent personal protective equipment and other supplies to cities in Japan. But some Korean residents responded with criticism.

Lee, whose complaints against the Korean Council launched the latest ordeal, says she’d like to see young Koreans and Japanese meeting to discuss their fraught history.

“Korea and Japan are neighbors. Our students eventually will be the owners of the countries. So these students need to know why we need an apology and compensation,” Lee said at a news conference this week.
“The students are the ones who will resolve the issue,” she said.

Lee is one of just 17 remaining women registered with the South Korean government as former comfort women—a euphemism used to describe those women and girls who were forced into sexual servitude for Japanese troops during World War II. She was shipped off to a kamikaze unit in Taiwan when she was 14 years old.

“I said what I had to say, and I will no longer be used,” she told the South Korean newspaper Joongang Ilbo.