Ministry of Land, Infrastructure and Transport Conducts Special Inspection of Real Estate Agents Suspected of Jeonse Fraud

Joint Inspection Team Formed with Seoul, Incheon, and Gyeonggi-do
Focused Inspection on HUG Guarantee Accident Brokerage Contracts

[Asia Economy Reporter Cha Wanyong] The Ministry of Land, Infrastructure and Transport announced on the 26th that it will conduct a joint special inspection with local governments targeting licensed real estate agents who mediated jeonse contracts. The period is from April 27 to May 31.

This special inspection is a follow-up measure to the "Jeonse Fraud Prevention and Damage Support Plan." The Ministry of Land, Infrastructure and Transport has formed a joint inspection team with Seoul, Incheon, and Gyeonggi Province, deploying about 150 personnel including real estate mediation officers and special judicial police from the cities, counties, and districts in these areas.

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The inspection targets contracts mediated by licensed real estate agents involved in Housing and Urban Guarantee Corporation (HUG) guarantee accidents that occurred in the past two years, focusing mainly on the Seoul metropolitan area where the damage scale is large. Among 4,780 nationwide guarantee accident mediation contracts, 4,380 cases (94%) occurred in the metropolitan area.

First, for efficient inspection, on-site investigations will be conducted on licensed real estate agents who mediated houses owned by malicious landlords more than twice.

For the licensed real estate agents subject to inspection, the Ministry will conduct a preliminary investigation by checking the registration status of their brokerage offices, including the registration seal at the time of office establishment, real transaction report records, and employment report records of affiliated licensed real estate agents and brokerage assistants.

Subsequently, the inspection will focus on ▲contracts for accident properties ▲sales and lease contracts of buildings at the same address ▲whether there are large-scale contracts with specific individuals other than the accident properties ▲and whether the real transaction price matches the contract amount.

Additionally, thorough investigations will be conducted regarding the lending of real estate agent licenses, unreported employment, and compliance with the obligation to verify and explain brokerage objects.

Based on the joint inspection results, administrative actions will be taken against illegal acts such as violations of brokerage object display and advertisement, failure to fulfill the obligation to verify and explain brokerage objects, and unreported brokerage assistants.

In particular, for serious illegal acts such as providing false information crucial to jeonse contracts, excessive brokerage fees, and price collusion, evidence will be secured and investigations will be requested from the police.

Won Heeryong, Minister of Land, Infrastructure and Transport, said, "As jeonse fraud targeting young adults and ordinary citizens has been continuous recently, thorough on-site investigations will be conducted," adding, "Licensed real estate agents involved in illegal acts will be strictly dealt with according to law and principles."

He continued, "To expel licensed real estate agents involved in jeonse fraud, we are expanding the application of the 'One Strike Out System' and are promoting legal amendments to impose the obligation on licensed real estate agents to explain important lease information to strengthen tenant protection."