[Exclusive] 11 Arrested Including 60-Year-Old Actual Owner in 3 Billion Won Jeonse Fraud Case

Real Owner and Real Estate Industry Officials Sent to Prosecution in Custody
About 30 Victims... Police "Thorough Investigation"

[Image source=Yonhap News]

[Asia Economy Reporters Hwang Seoyul and Jang Sehee] Eleven people were arrested by the police on charges of renting under false names to sign jeonse contracts and embezzling approximately 3 billion KRW in deposits.

On the 10th, the Seoul Gwanak Police Station announced that on December 30th of last year, they apprehended 11 individuals including Mr. A, a man in his 60s who was the actual owner behind the jeonse fraud, and sent them to the prosecution on fraud charges.

Among them, Mr. A was sent to prosecution under charges including fraud and forgery of documents under the Special Act on the Prevention of Economic Crimes, while Mr. B, a real estate industry associate who assisted Mr. A, was detained and sent on charges of fraud and violation of the Licensed Real Estate Agents Act. Nine others who lent their names were sent to prosecution without detention on fraud charges.

During the investigation of the actual name lenders, the police identified Mr. A as the true owner, marking a significant investigative achievement.

Mr. A is accused of borrowing other people's names to sign lease contracts and embezzling about 3 billion KRW from around 30 victims. Although ownership was transferred to a trust company, it is reported that false lessors pretended to hold ownership and defrauded tenants of their deposits. Mr. A is known to have embezzled fraudulent funds from people attempting to sign jeonse contracts in the Gwanak-gu area of Seoul.

Mr. A is also charged with embezzling about 1 billion KRW from financial institutions by inflating the collateral value of buildings during this process.

Meanwhile, the police classify jeonse fraud as a crime affecting ordinary citizens' livelihoods and are conducting special crackdowns. Since July last year, through the 'Jeonse Fraud Special Crackdown,' a total of 399 cases and 884 individuals have been apprehended. Regarding crime types, 34 were involved in gap investment without capital, 493 in false guarantee insurance, and 181 in violations of the Licensed Real Estate Agents Act.

Yoon Hee-geun, Commissioner of the National Police Agency, stated, "We are currently investigating the background related to the recently deceased lessor," and added, "We believe there may be similar cases and will conduct thorough investigations."