Gang Involved in Embezzling Billions in Jeonse Loans Using Fake Landlords and Tenants Referred to Prosecution

Three People Including Broker Sent to Prosecution in Custody
One Accomplice Indicted in Custody on 19th Last Month
Using 'Mugap Investment' Method
"Leader Under Investigation"

[Asia Economy Reporter Oh Gyumin] The police have sent a group who recruited fake landlords and tenants and embezzled tens of billions of won in youth jeonse loans from an internet-only bank to prosecution.

On the 21st, the Mapo Police Station in Seoul announced that on the 8th, they had arrested and sent three brokers accused of fraud under the Act on the Aggravated Punishment of Specific Economic Crimes (Special Act) to prosecution. Last month on the 19th, the police also arrested and indicted an accomplice broker A (42) on the same charges. Dozens of fake landlords and tenants who lent their names have been booked and are under investigation.

They used social networking services (SNS) to recruit fake landlords and tenants. They are accused of buying houses using the ‘no-gap investment’ method, where the landlord buys a house without funds using only the tenant's jeonse deposit, and embezzling tens of billions of won in youth jeonse loans.

The houses purchased by the fake landlords with the existing tenant's deposit had their ownership changed to the fake landlords, and they fabricated lease contracts to obtain youth jeonse loans from the bank.

They exploited the fact that the internet-only bank's jeonse loan screening process is ‘non-face-to-face’ and targeted the youth jeonse loan product guaranteed by the Housing and Urban Guarantee Corporation (HUG), which led to a formal screening process. In particular, since the product is aimed at 19 to 34-year-olds who are young people without income and without housing, they mainly recruited young people in need of money.

A police official stated, “The amount is estimated to be in the tens of billions of won, but the exact amount is under investigation.”

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