Economic Chief on Yoon's Auction Suspension Order: "Initiating Monitoring of Financial Institutions"

Chief Choi Sang-mok Holds Complete Victim List
Requesting Cooperation by Tracking Financial Institutions
Differences Between Villa King Case and Michuhol-gu Case
Whether Return Guarantee Is Subscribed

The Presidential Office announced on the 19th that it plans to begin monitoring financial institutions in connection with President Yoon Seok-yeol's directive on the 18th to temporarily suspend auctions of properties involved in "jeonse fraud" cases.

Chief Secretary Choi Sang-mok stated at a briefing held at the Yongsan Presidential Office in the afternoon, "We have a complete list of victims of (jeonse fraud). We are tracking financial institutions. We will identify all financial institutions today, notify them if possible within the day, request their cooperation, and starting tomorrow, we will monitor in real time whether the notified financial institutions are actually requesting auction suspensions."

He mentioned that the number of jeonse fraud cases in Michuhol District, Incheon, has reached 1,500, involving 131 related financial institutions, saying, "Among these, two are banks and the rest are secondary financial institutions. A significant portion of the claims held by secondary financial institutions have already been transferred to non-performing loan companies. The number of related financial institutions reaches into the hundreds."

He added that while it is practically difficult for all institutions to simultaneously take auction suspension measures, effective cooperation requests will be implemented by tomorrow.

Chief Secretary Choi explained, "Since July last year, the government has launched a special crackdown on jeonse fraud, arresting about 2,100 people. Prevention through the system itself is also important. There is an information asymmetry problem regarding tenants when signing jeonse contracts or conducting real estate transactions. To reduce this, we developed an application and established legal systems to supplement the obligations of real estate agents."

[Image source=Yonhap News]

Regarding the difference between the so-called 'Villa King case' and the recent Michuhol case, Chief Secretary Choi referred to whether a return guarantee was subscribed.

"In February, a person known as the 'Villa King' committed fraud using insurance from the Housing and Urban Guarantee Corporation (HUG). To prevent such fraud in advance, we improved the system by reducing the jeonse rate to 90% of the real estate transaction price and prioritizing official property prices to curb inflated real estate prices," he explained.

Chief Secretary Choi emphasized, "However, it is difficult to predict in advance the support for victims after an incident occurs. The February jeonse fraud victims had subscribed to the housing jeonse return guarantee, so we improved the system to enable them to receive the return guarantee quickly."

He continued, "In this case (the Michuhol District jeonse fraud), most victims did not have insurance, so there are practical difficulties, but the government is implementing support measures such as providing low-interest loans and arranging emergency housing."

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