Prosecutors Demand 6 to 14 Years Imprisonment for MergePlus CEO Siblings Over 'Refund Suspension'

Kwon Bogun Sentenced to 14 Years in Prison, Kwon Namhee Sentenced to 6 Years

Amid concerns over significant losses for many affiliated individual business owners, excluding large retail corporations prepared for compensation due to the massive refund crisis of the payment platform Merge Point, the headquarters of 'Merge Point' in Yeongdeungpo-gu, Seoul, on the 18th. Photo by Hyunmin Kim kimhyun81@

[Asia Economy Reporter Yoo Byung-don] The prosecution has requested prison sentences for the brother and sister who are the representatives of Merge Plus, the operator of 'Merge Point,' which caused damage worth thousands of billions of won due to a refund suspension incident.

At the sentencing hearing held on the 11th under the jurisdiction of the Criminal Division 11 of the Seoul Southern District Court (Chief Judge Sung Bo-gi), the prosecution requested that Merge Plus CEO Kwon Nam-hee (38) and his younger brother, Chief Strategy Officer (CSO) Kwon Bo-gun (35), be sentenced to six years and fourteen years in prison, respectively. The prosecution also sought orders for them to pay fines of approximately 710 million won and 5.33 billion won, respectively.

They were indicted on charges of fraud for selling Merge Money worth 252.1 billion won to 570,000 consumers despite the company accumulating deficits and facing a business suspension crisis from May 2020 to August last year.

They are also charged with violating the Electronic Financial Transactions Act by issuing and managing Merge Money, a prepaid electronic payment method, without registration with the Financial Services Commission from January 2020, and from June of the same year, providing electronic payment agency services to users of the 'VIP Subscription Service,' which offered a 20% discount payment.

CSO Kwon is also facing charges of breach of trust under the Act on the Aggravated Punishment of Specific Crimes, and was identified by the prosecution as the actual mastermind at the time of indictment.

[Image source=Yonhap News]

Meanwhile, the prosecution requested a fine of 10 million won for the Merge Plus corporation and a three-year prison sentence for another brother, Kwon Mo (37), who was indicted without detention on charges of embezzlement under the Special Act. Kwon Mo is accused, along with CSO Kwon, of using 6.7 billion won of corporate funds for living expenses, stock investments, and church donations.

Merge Plus gained popularity by promoting Merge Money as a prepaid recharge fund usable like cash and offering a '20% discount.' However, in August last year, a large-scale refund crisis occurred when major franchise stores such as convenience stores and large supermarkets terminated their contracts. Hundreds of subscribers demanding refunds gathered at the Merge Plus headquarters in Yeongdeungpo-gu, Seoul.

At the time of indictment in January this year, the prosecution estimated the actual damage amount at 75.1 billion won and the damage to Merge Point affiliates at 25.3 billion won.

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