Four individuals who used so-called "empty shell houses" to defraud tenants of 2.7 billion won in deposit money have been sentenced to prison.
On August 29, Judge Lee Changkyung of the Incheon District Court’s Criminal Division 1 announced that he had sentenced four people, including the ringleader of the jeonse fraud, Mr. A (56), and the manager, Mr. B (28), to prison terms ranging from one year and six months to three years on charges including fraud.
From November 2021 for about a year, Mr. A and his accomplices were brought to trial on charges of defrauding 23 jeonse tenants in the Incheon area out of a total of approximately 2.77 billion won in deposit money.
They were found to have purchased houses where the combined amount of jeonse deposits and loans exceeded the actual transaction price, transferred the obligation to return the deposits to so-called "straw landlords," and deceived tenants into believing the properties were safe.
The court also sentenced two others, including Mr. C (65), a broker’s assistant who was indicted alongside Mr. A’s group for violating the Certified Real Estate Agents Act, to either six months in prison suspended for two years or a fine of 5 million won. Mr. C received more than 20 million won in compensation, exceeding the legal commission, while assisting with the group’s sales contracts.
Judge Lee stated, "The crime of jeonse fraud, which caused 'empty shell jeonse' by simultaneously conducting sales and jeonse contracts for older villas, undermines the livelihoods of economically vulnerable citizens and young people."
He added, "The defendants divided roles among themselves and committed jeonse fraud against 23 people over the course of a year in an organized and premeditated manner. The amount of damage exceeds 2.7 billion won, making their culpability severe."
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