From July, Legal Maximum Interest Rate Reduced... Police to Conduct Intensive Crackdown on 'Illegal Lending' for 4 Months

Unregistered Loan Businesses and Illegal Debt Collection Targeted
Active Payment of Reporting Rewards Decided

[Asia Economy Reporter Lee Gwan-joo] Starting from the 7th of next month, the statutory maximum interest rate will be lowered from 24% to 20%, and the police will conduct intensive crackdowns on illegal lending businesses.

The National Police Agency's National Investigation Headquarters announced on the 28th that it will carry out a "focused crackdown on illegal lending businesses" for four months from July 1 to October 31. A police official explained, "Due to the increasing demand for illegal private loans and the operation of illegal lending businesses, which raise concerns about the growing harm to ordinary citizens, we have decided to conduct an intensive crackdown."

The main targets of the crackdown are ▲unregistered lending businesses ▲violations of interest rate limits ▲illegal debt collection such as assault, threats, and confinement ▲illegal lending advertisements. The police will mobilize direct investigation departments of city and provincial police agencies and intelligent crime investigation teams at police stations to carry out the crackdown. In particular, organized and malicious lenders will be strictly investigated by applying charges such as criminal organization formation, and criminal proceeds will be confiscated to prevent recidivism.

Additionally, to protect victims, the victim support team will provide legal consultation support, connect with related organizations such as the Korea Inclusive Finance Agency, and promote protection from disadvantages following reports. To encourage active reporting and tips, rewards for reporting (up to 20 million KRW) will be provided, and special crackdowns and intensive reporting period promotions will be conducted in cooperation with the Financial Supervisory Service.

Furthermore, the police will strengthen cooperation with related organizations by establishing a hotline with the Financial Supervisory Service, notifying the National Tax Service of investigation results for administrative sanctions and tax collection, and suspending phone numbers used in illegal lending advertisements. They will also promote awareness activities on crime methods and prevention measures.

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