"Allow Public Officials to Work Even After Bankruptcy Due to Jeonse Fraud"
"More Effective Than Opposition's 'Relief First, Recovery Later' Proposal"
The People Power Party proposed a party-backed amendment to the Special Act on Support for Jeonse Fraud Victims and Housing Stability, enacted last year, following demands for revisions and the expansion of deposit damages due to successive Jeonse fraud cases. The amendment focuses on supporting the profit from auction purchases of Jeonse fraud victim houses to maximize compensation for deposit losses.
On the 15th, Kwon Young-jin, the ruling party's secretary of the National Assembly Land, Infrastructure and Transport Committee, and Kim Eun-hye, a member of the People Power Party, submitted a bill to amend the Special Act on Jeonse Fraud to the National Assembly's Legislative Affairs Office. Photo by Kim Hyun-min kimhyun81@
Kwon Young-jin, the ruling party's floor spokesperson on the Land, Infrastructure and Transport Committee, submitted the amendment to the National Assembly Secretariat on the 15th and told reporters, "Despite the enforcement of the Special Act on Jeonse Fraud, blind spots in support have emerged due to the Korea Land and Housing Corporation (LH)'s purchase conditions, rental fee burdens, and various loan requirements, raising calls for legal revisions to provide practical support." He added, "To improve shortcomings in the current law's operation, we have proposed the amendment as a party-backed bill signed by all 108 People Power Party members."
Supporting Auction Profits to Maximize Deposit Compensation
Rep. Kwon said, "Through purchasing victim houses and supporting auction profits, we prioritize housing stability for victims and ensure maximum compensation for deposit losses." He explained, "The amendment allows LH and others to acquire victim houses through auctions and provide them as long-term joint rentals to victims without rental fee burdens." This means that if the purchase price is lower than the usual market price, the auction profit will be paid to Jeonse fraud victims. Additionally, the amendment establishes grounds for the government and local governments to provide additional financial support if auction profits do not cover ten years' worth of rental fees.
The amendment also addresses existing blind spots in the law. For violating buildings, it exempts the imposition of enforcement fines and allows local governments to approve usage changes if there are no safety issues for residents, providing a basis for legalization measures. It also establishes grounds for LH to participate in public auctions of trust properties, purchase them, and support victims with auction profits. Victim houses with senior tenants can be purchased without assuming their deposits and supported using auction profits.
No Employment Restrictions for Public Officials Even if Bankrupted Due to Jeonse Fraud
New support measures for Jeonse fraud victims have also been added. Rep. Kwon said, "There have been concerns about poor management of Jeonse fraud houses, especially multi-family houses." He added, "The amendment introduces a duty for local governments to manage the safety of various victim houses." He further emphasized, "A special provision has been established to ensure that public official employment is not restricted without a separate discharge procedure in case of bankruptcy. It also allows auctions for rehabilitation and bankruptcy cases that previously did not benefit and strengthens support by adding residential officetels to the Korea Housing Finance Corporation (HF) Bogeumjari Loan support targets."
Rep. Kwon explained the opposition Democratic Party's decision to also adopt the amendment as a party stance, saying, "We will discuss the Democratic Party's bill as well, but the part about 'rescue first, recovery later' raises questions about the effectiveness of evaluating guarantee claims." He added, "If that process takes too long and recovery is less than the evaluation, the Housing and Urban Guarantee Fund itself could be depleted." He continued, "It is more effective and immediate to have LH purchase victim houses through auctions and compensate deposits by covering auction profits," and said, "We will fully consult with the opposition."
Rep. Kim Eun-hye stated, "Jeonse fraud is not a private matter where victims and perpetrators dispute legal responsibility, but a public issue requiring state intervention," adding, "This is because the basic right of citizens to live comfortably in a stable housing environment has been violated." She further said, "To remedy the infringed rights of citizens, we will actively uphold the purpose of the bill, which specifies legal punishment and mandatory regulations, and strive to wipe away the tears of Jeonse fraud victims."
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