Won Hee-ryong, Minister of Land, Infrastructure and Transport, expressed his determination to permanently expel appraisers who deliberately inflated appraisal values and participated in jeonse fraud.
On the 23rd, Minister Won wrote on his Facebook, "Wrongdoings must be met with corresponding consequences," and added, "We will push for legal amendments to enable not only disqualification but also criminal punishment."
He stated, "It has been revealed that some appraisers were involved in jeonse fraud, causing young people and low-income citizens to suffer greatly. These individuals received disciplinary actions of up to two years suspension from work," and added, "Considering that victims lost their entire assets, a mere suspension is infuriating from the perspective of jeonse fraud victims."
He continued, "Wrongdoings must be met with corresponding consequences," and reiterated, "We will push for legal amendments to enable not only disqualification but also criminal punishment."
The Ministry of Land, Infrastructure and Transport held the Appraisal Management Disciplinary Committee the day before and decided to suspend the work of two appraisers who violated appraisal laws.
According to the Ministry, Mr. A was found to have issued nine collateral appraisal reports, including villas in Hwagok-dong, Gangseo-gu, Seoul, from October 2019 to April 2020, inflating appraisal values by excluding similar transactions within the same complex.
Appraiser Mr. B was confirmed to have issued a collateral appraisal report by inflating the appraisal value of a villa in Daeyeon-dong, Nam-gu, Busan, in January last year, and received a one-month suspension. The investigation revealed that although there were transaction cases within the same complex and price differences according to exclusive area, Mr. B selected high-priced external transaction cases to raise the appraisal value of the target property.
Appraiser Mr. C was investigated for not reflecting reasons for value reduction when issuing a general transaction appraisal report for a villa in Anyang-si, Gyeonggi-do. However, he received a warning because the appraisal value could not be considered higher than the market transaction price.
The Ministry plans to finalize disciplinary actions in April after notifying the relevant appraisal firms and appraisers and collecting opinions from the parties involved. This disciplinary action concerns 11 cases out of 15 suspected jeonse fraud cases under investigation since last year. Once the feasibility investigation is completed, the Ministry plans to proceed with disciplinary procedures for the remaining four cases and three appraisers.
Separately, the Ministry is conducting a full investigation into 1,203 cases over the past five years where housing and urban guarantee insurance was subscribed through appraisal reports but resulted in guarantee accidents.
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