Court: "Truly Needy People Can't Get Loans... Losses Must Be Covered by Public Taxes"
[Asia Economy Reporter Kim Daehyun] A man who fraudulently obtained 17.5 billion won in illegal real estate loans from financial institutions over more than a decade was sentenced to 12 years in prison in the second trial.
According to the legal community on the 17th, the Seoul High Court Criminal Division 3 (Presiding Judge Park Yeonwook) recently handed down this sentence to Mr. A (47, male), who was indicted on charges of fraud under the Act on the Aggravated Punishment of Specific Economic Crimes. Some of the damages were repaid, resulting in a 5-year reduction compared to the first trial.
Mr. A was prosecuted for acting as the ringleader of a loan fraud group from 2009 to 2019, submitting false documents such as sales contracts, lease contracts, and employment-related papers about 90 times to deceive seven financial institutions, including commercial banks, into granting mortgage loans and jeonse (key money deposit) loans totaling 17.5 billion won.
He was investigated for buying dozens of unsold apartment pre-sale rights at low prices and then deceiving financial institutions by presenting 'nominal buyers' as the actual owners, as if they had purchased at the original sale price, enabling each to receive loans worth several hundred million won. Mr. A paid the fake buyers hundreds of thousands of won each, while he kept the loan money for himself.
Additionally, he exploited the fact that financial institutions entrusted with worker housing jeonse loan services would grant loans with only formal reviews upon submission of employment-related documents and housing lease contracts. To facilitate this, he even established shell companies that produced false employment certificates and other documents.
Mr. A fled during his first trial in 2014 and was arrested in 2019. It was confirmed that up to two months before his capture, he continued to fraudulently obtain several hundred million won from financial institutions by mobilizing fake buyers, tenants, and landlords.
The appellate court stated, "Many financial institutions suffered significant losses, and those who truly need loans such as jeonse loans for ordinary citizens were unable to receive them. The losses caused by the defendant’s crimes will ultimately be covered by taxpayers’ money, causing great social harm."
It added, "As the ringleader of the loan fraud group, he directed and led the crimes overall, deceiving many economically vulnerable people into playing the roles of fake landlords and tenants, thereby involving them as accomplices and creating numerous offenders. Considering that he fled during the trial and repeatedly committed crimes without remorse, severe punishment is inevitable."
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