[Exclusive] Online Shopping Fraud Soars 13-Fold in 4 Years... 'No Victim Protection'

Last Year Cyber Fraud Losses Reach 305.7 Billion KRW... 'Highest Since Records Began'
Surge in Shopping Mall and Used Goods Transaction Scams
"Need for Victim Protection Measures"
Danggeun Market CEO Testifies in National Assembly

[Asia Economy Reporter Jang Sehee] Mr. A recently purchased a bundle of 20 ramen packs for 5,000 won from the online shopping mall ‘StyleV,’ but the products did not arrive even after a month. When he contacted the company to inquire about the delivery status, the communication was cut off. The number of damage relief applications received by the Korea Consumer Agency reached 88 cases. Mr. B, in his 70s, saw a post on Danggeun Market selling agricultural machinery at half the market price for 1 million won and made a deal, but after sending a total of 4 million won due to the seller’s request for market fees, he did not get the money back.

As cyber fraud has been rampant due to the activation of non-face-to-face transactions amid COVID-19, voices are calling for urgent protection of victims.

According to the ‘Cyber Fraud Damage Status’ data submitted by the National Police Agency to Rep. Jeong Woo-taek of the People Power Party on the 26th, last year’s shopping mall fraud damage amounted to 13.3 billion won, which is 13.4 times higher than 1 billion won in 2017. The total cyber fraud damage increased elevenfold in four years from 27.4 billion won in 2017 to 305.7 billion won last year, marking the highest since the statistics began in 2015. Cyber fraud includes ▲direct transactions (used goods transactions) ▲shopping malls ▲games ▲email trade fraud, etc.

Last year, direct transaction damage also reached a record high of 257.3 billion won. In addition, game and email fraud damage amounted to 10.5 billion won and 24.5 billion won, respectively. A National Police Agency official stated, "The amount of cyber fraud damage is at its highest level since the statistics began in 2015," adding, "In particular, fraud damage in used goods transactions is increasing significantly." Police investigators at the front lines also explained, "There is a phenomenon where past face-to-face fraudsters are moving online," and "The number of victims and the amount of damage have increased significantly."

Rep. Jeong said, "The number of people purchasing goods online has increased significantly during the COVID-19 situation, and crimes exploiting this are also increasing, which is concerning," adding, "Along with reviewing laws related to prevention and punishment of internet fraud, the Ministry of the Interior and Safety and the police should establish a response manual that can be immediately implemented and execute it swiftly."

Although cyber fraud damage is increasing, there are criticisms that victim protection measures are insufficient. Even if victims suffer damage on platforms such as internet shopping malls and Danggeun Market, it is difficult to verify information about sellers without cooperation requests from investigative agencies.

Unlike cyber financial crimes (messenger phishing, bodycam phishing), cyber fraud does not allow account payment suspension. The amendment to the Telecommunications Fraud Damage Refund Act proposed last year is currently pending in the National Assembly. According to front-line police investigation departments, recently, financial fraudsters have been abusing this by claiming that since they conducted ‘goods transactions,’ they want the account payment suspension lifted.

Meanwhile, the political circle also plans to establish institutional safeguards to prevent cyber fraud damage to ordinary citizens. The National Assembly’s Public Administration and Security Committee is reportedly agreed to summon Kim Jae-hyun, CEO of Danggeun Market, and others as witnesses. A committee official stated, "Both ruling and opposition parties agree that it is important to prevent the rapidly increasing fraud damage recently."

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