Financial Institutions and Trust Companies Agree to Postpone Eviction Lawsuits for Victims of Trust Jeonse Fraud

Democratic Party Plans to Pass Special Law on Jeonse Fraud This Month

Financial institutions and trust companies have agreed to postpone eviction lawsuits against victims of trust lease fraud. The Democratic Party of Korea emphasized that the ruling and opposition parties will handle the Special Act on Lease Fraud, which is being negotiated to resolve conflicts of interest that may arise when eviction lawsuits are not pursued, within this month.

Park Jumin, Chairman of the Euljiro Committee of the Democratic Party of Korea Photo by Hyunmin Kim kimhyun81@

The Democratic Party's Euljiro Committee and the Special Committee on Lease Fraud held a roundtable discussion on the 8th at the National Assembly Members' Office Building in Yeouido, Seoul, to provide relief for victims of trust fraud. The meeting was attended by trust company officials such as Kim Gyu-cheol, Vice Chairman of Korea Asset Trust, and Park Myung-ho, Vice President of KB Real Estate Trust, as well as financial institution representatives including Lee Soo-chan, Executive Director of Busan Bank, Woo Uk-hyun, Managing Director of the National Credit Union Federation of Korea, and Choi Eun-joo, Head of the Credit System Department at Saemaeul Geumgo.

Financial institutions and trust companies agreed to postpone eviction lawsuits filed against victims of trust lease fraud. Trust lease fraud refers to deceiving tenants by falsely representing properties entrusted to trust companies as their own real estate and embezzling the tenants' lease deposits. Since these are classified as false contracts, tenants cannot assert their rights, and trust companies have filed eviction lawsuits against tenants to reclaim possession. Park Ju-min, Chair of the Euljiro Committee, said, "The entire creditor group agreed with the concern over trust lease fraud" and added, "They agreed not to proceed with eviction lawsuits or to postpone them for a certain period."

However, it is known that financial institutions expressed concerns about potential pressure from financial authorities if eviction lawsuits are delayed. Chair Park said, "Some members of the creditor group worried that postponing eviction lawsuits might lead to unfavorable measures from financial authorities," and added, "We will discuss this matter with the financial authorities." Democratic Party lawmaker Kim Nam-geun said, "Financial institutions worry about supervision if they delay handling non-performing loans, but the likelihood of that is very low," while also stating, "Since there are concerns, we will meet with the Financial Supervisory Service to confirm."

The Democratic Party announced its intention to pass the Special Act on Lease Fraud, which is being negotiated between the ruling and opposition parties, within this month. Moon Jin-seok, Secretary of the Special Committee on Lease Fraud, said, "From the financial institutions' perspective, conflicts of interest arise when eviction lawsuits are not pursued," and added, "The ruling and opposition parties have agreed on the broad framework of the Special Act on Lease Fraud and to pass it within the August National Assembly session."