Investment Scam That Even Fooled 'Yeochin' Leading to Suicide... New Corporate 'Wage Claim' Fraud, 40s Fugitive Embezzled Billions

Busanjin Police Station Applies for Arrest Warrant for CEO Kim on Charges of Unauthorized Fundraising and Fraud

[Image source=Daewon Industrial Comprehensive Development website]

[Asia Economy Yeongnam Reporting Headquarters Reporter Kim Yong-woo] A man in his 40s, who established a large corporation manpower dispatch company and disappeared after collecting tens of billions of won from job seekers and others by promising high returns, was caught by the police.

The victims, who visited the company for employment purposes, were deceived by the promise of immediate monthly salary and investment dividends until dispatch to a large corporation, and joined this fake company, investing 50 million won per share. (Reported in the online edition on September 13 and 15)

According to Busanjin Police Station in Busan on the 20th, Kim (45), CEO of Daewon Industrial Comprehensive Development, who was issued an arrest warrant on the 13th, was hiding in a one-room apartment in Myeongji-dong, Gangseo-gu, and was caught by the police on the 19th, six days after the warrant was issued.

Kim set up an office in Seomyeon, downtown Busan, and established a corporation called Daewon Industrial Comprehensive Development in September last year. He deceived investors by claiming that investing in the manpower business of a top-tier large construction company with ‘wage claims’ would yield a monthly 3% dividend and allowances.

The victims received high returns and salaries for the first one to two months, felt reassured, and even reinvested, but began to suspect when payments were not made on the scheduled dates thereafter.

Recently, when about ten victims demanded repayment of the principal, Kim disappeared around the 6th.

The company posted job advertisements for regular employees on job search websites and collected investment funds ranging from 50 million won to as much as 350 million won per person by promising 3% monthly interest, totaling 36% annually, and used a Ponzi scheme.

Kim and others promoted the company as if they had made development investments worth about 100 billion won by having promotional articles published in major central and economic newspapers, reassuring investors and attracting more funds. It was also revealed that they illegally lent money to construction site workers in urgent need of cash using the collected investment funds. Three executives also participated in recruiting investors, but the police explained that they are also considered victims as they lost more than 1 billion won each to Kim.

Kim was subject to an arrest warrant application on charges of quasi-acceptance of deposits and fraud for pocketing about 4.2 billion won from 16 people by promising to pay 2% of the principal and 1% recruitment allowance from October 2020 to June this year.

There was even a victim who took their own life during Kim’s fraudulent activities.

On the 15th, Kim’s girlfriend (in her 30s) was found dead by an acquaintance at her apartment home in Haeundae.

The woman, who was reportedly dating Kim with marriage in mind, had lent him about 130 million won and filed a complaint with the police after realizing she had been deceived. She is believed to have taken the extreme step afterward.