"Support the Marginalized" Telemarketing Company Head Indicted for Embezzling 5 Billion Won

Pretending to Be a Charitable Organization
Embezzling Donations Meant for Marginalized Groups

The operator of a telemarketing company has been indicted on charges of fraudulently obtaining billions of won in donations by falsely claiming to support socially marginalized groups.

On May 1, the Criminal Division 5 of the Seoul Southern District Prosecutors' Office (Chief Prosecutor Cho Jaecheol) announced that it had indicted Mr. A (a man in his 50s), the operator of the telemarketing company, on charges of violating the Act on the Aggravated Punishment of Specific Economic Crimes (fraud). Ms. B (a woman in her 40s), who served as the chief of operations, was indicted without detention. They are accused of defrauding a total of 5 billion won from approximately 19,000 people under the pretense of collecting educational sponsorship funds for socially marginalized groups.

According to the investigation, from September 2010 to October 2015, the two recruited members by claiming that those who made monthly donations to the "Sharing Education Campaign" would be providing online lectures to socially marginalized groups, thereby deceiving the victims. Most of the funds collected were distributed as recruitment commissions to members of the telemarketing organization and were used for purposes unrelated to sponsorship. They also provided money and valuables to Corporation C, which was established to support people with disabilities, under the pretext of consulting fees, and received donation receipts in the name of Corporation C. Due to the nature of small donations, most of the victims are believed to be ordinary citizens.

The prosecution believes that the victims' donations were not actually used for charitable purposes, yet tax deductions were granted, resulting in financial losses to the state.

Initially, the prosecution received the case from the police in September 2021, but after requesting supplementary investigation, the case was resubmitted in February last year. The prosecution then investigated the suspects and witnesses until March of this year and applied for an arrest warrant for Mr. A on April 15. A prosecution official stated, "We will do our utmost to ensure that a stern sentence is imposed on the defendant, who exploited goodwill and deprived those in need of donations of their opportunities."