Rampant Illegal Deposit-Taking... Why Are Victims Left with the "Investigation Homework"? [The Plaintiff Turned Detective]②

Vast Evidence and Numerous Victims: Investigative Agencies Avoid “Illegal Deposit-Taking Cases”
Repeated Account Tracking and Search Operations
Treated as So-Called “Labor-Intensive” Cases
Delays Worsened After Adjustment of Investigative Powers
Concerns Over Manpower and Systemic Issues After the Launch of the Serious Crimes Investigation Agency

Editor's NoteAs the bill to abolish the Prosecutors’ Office is set to pass the National Assembly’s plenary session on the 25th, people on the ground are engaged in disputes that are close to “private lawsuits.” While the government promotes “prosecution reform without harm to the public,” the reality felt by victims of criminal cases is different. This newspaper examines the disorder that has emerged in the field after the adjustment of investigative powers between the police and the prosecution, and diagnoses the problems that citizens will face one year into the era of the Serious Crimes Investigation Agency.

Large-scale organized fraud cases, such as illegal deposit-taking and multi-level marketing scams, have been increasing every year, but investigative agencies tend to avoid these cases. Because the volume of investigative work-from tracking bank accounts to interrogating suspects-is so vast, these cases are often treated as “labor-intensive cases.” Hundreds or even thousands of victims must be interviewed one by one, and search and seizure operations must be repeated. It is often difficult to distinguish between perpetrators and victims, which frequently delays the initiation of investigations.

According to the Supreme Prosecutors’ Office on September 22, the number of illegal deposit-taking and multi-level marketing fraud cases increased from 3,071 in 2022, to 3,335 in 2023, and 3,727 in 2024, following the COVID-19 pandemic. However, the final disposition rate (including indictments, summary indictments, and non-prosecution decisions) has remained in the 20-30% range, meaning that most investigations are prolonged.

Crimes with multiple victims often involve organized, nationwide offenses that continue for extended periods, and investigations typically begin only after the damage has spread. As a result, it is difficult to collect evidence, and the case records are extensive. During this time, criminal organizations launder and conceal the proceeds, making it increasingly difficult for victims to recover their losses.

Since the adjustment of investigative powers, initial investigations of such cases have been concentrated in the police, but the professional workforce and evaluation systems have not kept pace. Kim Wooseok, an attorney at Myungjin Law Firm, pointed out, “Because police officers are not legal professionals, they often struggle with cases involving complex legal issues such as property crimes. There is growing public dissatisfaction that cases are being delayed since the adjustment of investigative powers between the police and the prosecution, and this gap will become even more serious going forward.”

A lawyer who previously served as a chief prosecutor said, “It is not easy to prove that illegal deposit-taking has occurred, and when the scale is large, it is extremely difficult because you have to track bank accounts, conduct search and seizure operations, and follow the flow of funds. Even if the main perpetrator is arrested, completing the investigation of accomplices requires enormous effort, so these cases are always pushed to the back of the line on the ground.”

Another lawyer stated, “There is a high probability that economic crimes will not be properly investigated by the police, and the backlog of cases will inevitably worsen. Since prosecutors are reluctant to move to the Serious Crimes Investigation Agency, there will be considerable confusion in maintaining indictments for illegal deposit-taking cases, where there are many accomplices and the line between victims and perpetrators is blurred.”