"Group Defrauding Investors of Billions with 'Big Profits if Listed' Scheme Sentenced to Prison in First Trial"

A group that deceived investors into believing they could earn huge profits by investing in unlisted stocks and embezzled hundreds of millions of won in investment funds was sentenced to prison.

According to the legal community on the 6th, Yoon Yang-ji, presiding judge of Criminal Division 10 at the Seoul Western District Court, sentenced A (30) to one year in prison and ordered a fine of 35 million won on the 16th of last month on charges of fraud and violation of the Act on Capital Market and Financial Investment Business. B (29), who was also indicted on the same charges, was sentenced to two years in prison and fined 43 million won; C (34) was sentenced to three years in prison; and D (29) was sentenced to two years in prison and fined 50 million won. The court stated as the reason for sentencing, “They committed highly organized and planned crimes by dividing their roles and operating systematically,” and “They caused significant financial damage to multiple victims, resulting in great social harm.”

They are accused of establishing branches of several unauthorized financial investment companies, deceiving investors into believing that unlisted companies would soon be listed and yield large profits, selling unlisted company stocks, and conspiring to distribute 40-65% of the sales amount as commissions to each branch.

A acted as a team leader at one branch, selling unlisted stocks and receiving 15% of the sales amount as commission. He is accused of selling unlisted stocks worth a total of 159.51 million won to seven people from May 27 to September 8 of last year. According to the Act on Capital Market and Financial Investment Business, financial investment business cannot be conducted without authorization. He is also charged with fraud for falsely telling victims that “(the unlisted company) will yield at least 350% profit once listed.”

C operated a team in Bucheon-si, Gyeonggi Province, serving as a middle manager who communicated the types of unlisted stocks to be sold and promotional phrases about company information to each branch, received sales revenue in cash, and paid commissions. While managing other branches, he is also accused of embezzling unlisted stocks worth a total of 574 million won from 10 people between October 14, 2021, and September 8 of last year.

B and D jointly established a branch in Dobong-gu, Seoul, acted as representatives, instructed employees to sell unlisted stocks, and distributed the received sales revenue to the employees.

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