Representative of Agency Embezzling 65.6 Billion KRW from Local Housing Association Funds Indicted

[Asia Economy Reporter Song Seung-yoon] The CEO and executives of a business agency, along with cooperative association officials, who embezzled 65.6 billion KRW in regional housing cooperative funds, have been brought to trial.

The Seoul Eastern District Prosecutors' Office Corporate and Labor Crime Division (Chief Prosecutor Choi Hyung-won) announced on the 15th that they have indicted the actual CEO A (54) and executive B (52) of the business agency on charges of embezzlement and breach of trust under the Act on the Aggravated Punishment of Specific Economic Crimes. Four related persons, including the cooperative association heads who colluded with them, were also brought to trial.

A is accused of receiving approximately 26.6 billion KRW in contributions from 141 cooperative members into the personal account of an executive of the business agency, together with B, from 2018 until October this year, and using the funds for gambling and personal debt repayment.

A also caused a loss of 2 billion KRW by drafting contracts unfavorable to the cooperative. From 2015 over about six years, they transferred approximately 200 million KRW in salary under the pretense of employing B’s ex-wife as a business agency staff member, then used it for personal purposes. Approximately 30.3 billion KRW of the business agency’s funds were also used for gambling and debt repayment. The total damage suffered by 747 cooperative members due to their crimes amounted to 65.6 billion KRW.

The prosecutors viewed that the heads and executives of two regional housing cooperatives who suffered damages were acquaintances of A and had a collusive relationship. Two cooperative heads, who had the duty to supervise the business agency, negligently managed cooperative funds by approving fund execution without procedures such as general assembly resolutions.

The prosecution received the case from the Financial Intelligence Unit (FIU) in April this year, tracked the business agency’s accounts, and conducted searches of offices and residences. After about six months of investigation, A and B were arrested last month. The prosecution also requested seizure and preservation of assets worth approximately 12.1 billion KRW held under A’s real name.

A prosecution official stated, "We will ensure thorough prosecution so that the defendants receive sentences appropriate to their crimes and make every effort to recover the actual damages." They also advised, "If contributions are deposited into personal accounts, they will not be recognized as cooperative member contributions, which can lead to greater damages, so caution is needed when joining cooperatives."

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