Loan company demands repayment of 400,000 won after lending 200,000 won... threats and overdue interest included

Antisocial Threats Including Sending Nude Photos to Family Members

A lawsuit seeking confirmation of contract invalidity was filed for the first time against an illegal loan company that demanded astronomical interest from debtors who borrowed emergency funds.

The Korea Legal Aid Corporation announced on the 22nd that it filed a lawsuit seeking confirmation of contract invalidity on behalf of Mr. B, who borrowed money from illegal loan company A, targeting four individuals including the head of the company, middle managers, and subordinate employees. Considering the mental damage Mr. B suffered from them, the Corporation also claimed 10 million KRW in damages from company A in the lawsuit.

Illegal loan business. Not related to specific expressions in the article.

Mr. B, a man in his 30s with two children, worked as a manager at a construction company earning over 4 million KRW per month. However, due to the sluggish construction industry, his salary was delayed for several months. In January of last year, he borrowed 200,000 KRW in emergency funds from company A through an internet loan caf?.

Company A lent Mr. B the emergency funds under the condition of a 7-day loan period with a repayment amount of 400,000 KRW, and demanded 20,000 KRW interest per day in case of delay. Even if repaid within the loan period, the interest rate amounts to a staggering 4562%. The current legal maximum interest rate is 20%.

Additionally, company A obtained contact information for 11 people including Mr. B’s grandparents, parents, workplace acquaintances, and friends, as well as screenshots of KakaoTalk profiles, and Instagram accounts of 9 relatives and acquaintances. Furthermore, they also acquired a selfie photo of Mr. B holding the loan agreement.

After Mr. B failed to repay the principal and interest on time, the head of company A and others threatened to send nude photos of Mr. B, and actually distributed them to 9 people including Mr. B’s father, friends, and acquaintances.

Mr. B did not provide nude photos to company A, but company A reportedly used nude photos that Mr. B had sent to other loan companies in the past through a Telegram chatroom established by a coalition of illegal loan companies.

Lee Jong-yeop, Director of the Korea Legal Aid Corporation, stated, "This lawsuit is the first case following the memorandum of understanding with the Financial Supervisory Service to support contract invalidity lawsuits against antisocial illegal loan contracts," and emphasized, "We will eradicate malicious and antisocial loan contracts."