Police Arrest 2,151 Suspects of Financial Crimes Including Fraudulent Fundraising Affecting Livelihoods in First Half of Year

[Asia Economy Reporter Seongpil Cho] The National Police Agency's National Investigation Headquarters announced on the 21st that it detected 837 cases and arrested 2,151 people as a result of a focused crackdown on illegal private loans and fraudulent fundraising, among other financial crimes infringing on people's livelihoods, during the first half of this year. The police added that during the special crackdown investigation, 31 people were detained, and in 50 cases, approximately 20 billion KRW worth of criminal proceeds were preserved (disposal prohibited).

By category, in the illegal private loan sector, the number of arrests increased by 21% compared to the same period last year (427 cases → 516 cases). The number of people arrested (784 → 1,051) also rose by 34%. Illegal private loans refer to unlawful acts targeting economically vulnerable groups who cannot use formal financial institutions, charging high interest rates exceeding 20% per annum, and using violence or threats against ordinary citizens who cannot repay the money.

The number of arrests in fraudulent fundraising and illegal multi-level marketing also increased (192 cases → 252 cases) along with the number of people arrested (594 → 958). Typically, fraudulent fundraising cases use a so-called 'Ponzi scheme' method, recruiting investors by guaranteeing principal and promising high returns, then paying earlier investors with the funds of later investors. The police explained that thorough investigations from masterminds to simple participants led to the increase in both the number of cases and arrests.

In investigations related to unfair trade practices and illegal investment companies, 69 cases and 142 people were arrested. Among these was the Discovery Fund redemption suspension case, which caused large-scale victimization. The police also explained that among illegal investment companies, the majority used methods such as enticing people to join stock reading rooms or stock trading sites via the internet with bait like "loss recovery" or "300% profit certification," then deceiving them by charging consultation fees or stock recommendation fees.

The police judged that financial crimes targeting economically vulnerable groups remain severe and plan to continue focused crackdowns on financial crimes infringing on people's livelihoods from the 22nd until the end of October. Especially in the latter half of the year, they will also block various illegal advertisements using text messages and the internet in parallel with the crackdown. A National Investigation Headquarters official said, "Due to the recent economic downturn and rising prices, ordinary citizens struggling in their daily lives are at greater risk of falling victim to financial crimes," adding, "We will continue to do our best to prevent and crack down on various crimes that hurt ordinary citizens and small business owners."

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