"Guaranteed Principal and High Interest Through Auction Investment" Promise
ID Cards Collected, Phones Opened, Then Loans Taken Out
On the 10th, according to the financial sector, Shinhan Bank, KB Kookmin Bank, and SC First Bank reported financial accidents totaling approximately 5.6 billion KRW, with 1.998 billion KRW, 2.2214 billion KRW, and 1.4679 billion KRW respectively, related to a large-scale jeonse fraud case that occurred in the Sejong area.
The police announced on the 10th that they have arrested and sent a woman in her 40s, Ms. A, who illegally obtained loans from the local banks by using tenants' identities and embezzled the money, and are also investigating accomplices. The Sejong Police Agency transferred Ms. A to the prosecution on charges including fraud and forgery of private documents under the Act on the Aggravated Punishment of Specific Economic Crimes.
Ms. A, who works at a large corporation in Cheongju, Chungbuk, is accused of opening mobile phones under the names of about 30 colleagues and then executing jeonse loans and credit loans in the victims' names to embezzle funds. The victims suffered loan damages ranging from about 50 million KRW to approximately 600 million KRW per person.
Ms. A persuaded her colleagues to invest in real estate auctions, promising the principal plus 10% interest. Having known Ms. A for over ten years and seeing her live a wealthy lifestyle, as well as hearing that she made money through real estate auctions, the colleagues trusted and invested in her. As both the interest and principal were returned, the victims grew to trust Ms. A.
Ms. A deceived them by requesting identification cards and power of attorney documents, promising 2 million KRW for lending their names and an additional 5 million KRW upon successful auction bids. Using the victims' IDs she received, she opened mobile phones, obtained certificates via the phones, and then took out credit and jeonse loans in the victims' names to embezzle funds.
Ms. A's fraudulent activities were uncovered last October when a victim who received a loan delinquency payment order mail, which she had never received, reported it. The apartments where Ms. A executed the jeonse loans are located in Chungbuk, Chungnam, and Sejong, and as more complaints from victims continue to be filed, the scale of the damage is expected to increase.
The police believe that the crimes, from mobile phone activation to jeonse contracts and loan execution, were not committed solely by Ms. A and are investigating accomplices. They are also verifying the bank accounts where Ms. A transferred the loan money and the whereabouts of the remaining funds. Ms. A told the police that she used the criminal proceeds for interest repayment, loan repayment, living expenses, and purchasing luxury goods.
The exact amount of loss is expected to be finalized after the police investigation is completed. Based on this, the banks plan to take legal action against the victims involved in the fraudulent loans.
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