'House Price Collusion' Finally Facing Punishment... 11 Criminal Cases Filed, 100 Under Investigation

Response Team Launched in February Announces Interim Investigation Results
Homeowners Confirmed for Price-Fixing Crime...Prosecution in Sight
Illegal Activities Through Real Estate Agents' Social Club Also Uncovered
Search Warrants Issued for Online Cafe Investigation

[Image source=Yonhap News]

[Asia Economy Reporter Moon Jiwon] The Ministry of Land, Infrastructure and Transport has investigated the 'housing price collusion' acts by landlords, which have been considered the main culprits disrupting the real estate market, and has criminally charged 11 cases where criminal suspicion was confirmed. These cases will be transferred to the prosecution after investigation. This is seen as the government’s crackdown on illegal real estate activities to stabilize housing prices entering full swing.

The Ministry’s 'Real Estate Market Illegal Activity Response Team (hereinafter Response Team)' announced the interim results of the investigation into housing price collusion on the 21st.

Earlier, on February 21, the Ministry of Land, Infrastructure and Transport launched the Response Team directly under the First Vice Minister, composed of the Ministry’s Special Judicial Police Division, the Financial Services Commission, the Prosecutor’s Office, the National Police Agency, the National Tax Service, the Financial Supervisory Service, and the Korea Real Estate Board, as part of the enforcement of amended laws to establish order in the real estate market.

According to the amendment to the Licensed Real Estate Agents Act, landlords’ housing price collusion acts are completely prohibited. Licensed real estate agents are also prohibited from colluding by adjusting prices through 'social gatherings' or restricting joint brokerage with non-members. Violations may result in imprisonment for up to three years or fines up to 30 million KRW.

The Response Team immediately launched a full-scale investigation focusing on housing price collusion. Through the 'Real Estate Transaction Order Disruption Reporting Center (hereinafter Reporting Center)' established at the Korea Real Estate Board, 364 suspected cases of housing price collusion were received, and investigations were initiated on 166 cases deemed to require priority investigation.

As a result of the preliminary investigation, the Response Team confirmed criminal suspicion in 11 cases and took criminal charges. Fifty-five cases were closed due to lack of suspicion, and the remaining 100 cases will continue to be investigated.

Among the 11 criminally charged cases, 10 involved housing price collusion using online platforms. According to the Ministry, apartment landlord Mr. A was caught posting notices and banners urging not to use real estate agencies that register low-priced listings. Mr. B posted on an internet cafe, "Let’s never give properties to XX Real Estate... List properties over 500 million KRW at the real estate." All are subject to punishment.

Collusion acts by real estate agents were also detected. Licensed real estate agent Mr. C, belonging to a cartel of agents in a specific area, refused joint brokerage proposed by another licensed agent, saying, "According to the bylaws, joint brokerage is not allowed unless belonging to the same cartel." Such acts restrict fair competition in the industry and interfere with consumer transactions, thus considered disruptive acts in real estate.

The Response Team applied for search and seizure warrants for online cafes and private joint brokerage information networks to the competent prosecutor’s office to prove their illegal acts. Warrants were issued for eight cases, and procedures for issuing warrants are underway for two cases. The Ministry explained, "For acts before the law enforcement, voluntary corrective actions such as removal of notices and banners and deletion of posts have been confirmed."

The Response Team plans to swiftly transfer the 11 criminally charged cases to the prosecution with indictments after executing search and seizure warrants and interrogating suspects. Also, for the 100 suspected housing price collusion cases currently under investigation, they plan to promptly criminally charge them through victim testimonies and on-site verification.

Furthermore, the Response Team will investigate disguised address changes for subscription lottery wins, trading of subscription savings accounts, violations of display and advertising through online and social networking services (SNS), and unqualified brokerage activities online, with cooperation from organizations such as the Korea Internet Advertising Foundation.

Kim Younghan, head of the Response Team and Director of Land Policy at the Ministry, emphasized, "Going forward, the Response Team will continue to conduct intensive investigations into real estate-related crimes and actual transaction surveys." He added, "Secretive housing price collusion investigations rely heavily on public reports. We will make every effort to eradicate illegal acts through active investigations if illegal suspicious acts are reported."

This content was produced with the assistance of AI translation services.