"Payback for Full Cash Payment of Device"…Store Owner Cheats Customers Out of Tens of Millions Won

Chuncheon District Court Wonju Branch Sentences 6 Months Imprisonment
Conducted Excessive Payback Event Leading to 'Ponzi Scheme'

A mobile phone store owner who defrauded over 44 million won from about 30 customers by promising to refund part of the payment if the full price of the mobile phone was paid in cash was sentenced to prison and detained in court.

On the 10th, the Chuncheon District Court Wonju Branch Criminal Division 2 (Presiding Judge Park Hyunjin) sentenced A (34), who was indicted without detention on charges of fraud, to six months in prison and detained him in court, according to Yonhap News on the same day. The court also ordered A to compensate five victims between approximately 3 million and 19 million won each.

Chuncheon District Court Wonju Branch Photo by Yonhap News

A, who operated a mobile phone store in Wonju, Gangwon Province, was tried on charges of deceiving more than 30 customers from February 2020 to January 2023 by promising to refund part of the mobile phone price in a payback method if they paid the full price in cash, thereby embezzling a total of 44.51 million won. He conducted an excessive payback event targeting customers, accumulating amounts to be refunded that he could not afford, but continued to cover up the payments, committing this crime.

A used the mobile phone payments received from victims to pay refunds to other customers or to settle accounts with mobile phone wholesalers. Due to this excessive cover-up, some customers who were deceived by A into purchasing mobile phones suffered damages such as installment payments not being fully settled.

The first trial court stated, "The defendant’s crime of embezzling 44 million won from more than 30 customers while operating a mobile phone store is an act that betrays trust," and added, "Considering the number of offenses, the amount embezzled, and the lack of compensation for damages, a prison sentence is inevitable."

Regarding the sentencing, the court explained, "Some paybacks were made, and the actual damages to the victims are expected to be less than the embezzled amount, so the sentence was determined comprehensively." Both A and the prosecution appealed the first trial ruling, citing 'unfair sentencing' as the reason.