Namcheol Lee, President of the Korean Association of Certified Judicial Scriveners, "Complete Registration Disclosure" to Grant Tenants the "Right to File Auction Requests"

There are those who view the nationwide jeonse fraud crisis that struck Seoul, Incheon, Busan, Dongtan, and other areas differently and have stepped up to assist the victims. These are the certified judicial scriveners. Judicial scriveners are at the forefront of our legal services, working on the ground and possessing practical expertise like no one else. Even for these judicial scriveners, this jeonse fraud crisis is perceived as both unfamiliar and shocking. On the 27th, Lee Nam-cheol, president of the Korea Certified Judicial Scriveners Association, who has been working as a judicial scrivener for 22 years since entering the field in 2001, told this publication that this jeonse fraud crisis is "new." He said, "While problems causing many victims have frequently occurred in our society before, they mostly stemmed from stocks, funds, and savings banks. Jeonse fraud combines issues of housing and money, making it even more serious. Most victims are in their 20s and 30s, and this crime should be seen as one that destroys the foundation for young adults starting their lives," he emphasized.

I met Lee Nam-chul, President of the Korea Certified Judicial Scrivener Association, at his office in Gangnam-gu, Seoul, to hear the judicial scrivener's perspective on the jeonse fraud case. Photo by Heo Young-han younghan@

"Distinguishing Accident from Fraud Is Difficult but a Necessary Precondition"

Since the association joined forces with HUG (Housing and Urban Guarantee Corporation) to operate Jeonse Victim Support Centers in Seoul, Gyeonggi, Incheon, Busan, and other areas, they have handled over 7,000 consultations as of last March. In particular, there were more than 6,000 cases concentrated in Hwagok-dong, Gangseo-gu, Seoul, where jeonse fraud was rampant. The association president said, "Fraudulent behaviors are very diverse," adding, "Fraud requires intent, and it is necessary to distinguish between accidents and fraud, but that distinction is very ambiguous." The so-called 'Villa King' cases, where an entire building of unsold houses was purchased and appraisal values were inflated to appear expensive to attract tenants, are typical fraud methods where proving intent is relatively easier. The problem lies in jeonse fraud through 'gap speculation' (a speculative method where houses with a small difference between sale price and jeonse price are purchased for capital gains, and tenants are found immediately before or after purchase).

The association president said, "At first, many start with good intentions, buying one or two houses as gap investments to follow trends, but as the number of houses they own increases, accidents occur. These incidents happened due to a sudden decline in housing prices," adding, "In such cases, it is difficult to determine whether the homeowner had fraudulent intent. However, it is highly likely that they anticipated 'an accident might happen' during the process of purchasing the houses."

"If Someone Had Helped, There Would Have Been No Extreme Choices"

Jeonse fraud has led victims to make extreme choices, raising awareness in our society. It also triggered the government to prepare urgent countermeasures. The association president said, "I believe that if someone had listened and helped, the victims would not have made such tragic decisions." When suffering from jeonse fraud, he advises consulting a judicial scrivener immediately and confirming the current legal status as a tenant. He said, "You must quickly ascertain whether you have priority opposability through moving-in registration, moving, and fixed date registration, understand the interests related to the property, and check for any national tax arrears. If a court auction is underway, you should also secure related documents." Then, necessary actions should be taken. For example, if planning to move, apply for a tenant's registration order, and if an auction is in progress, file a distribution claim.

Above all, the association president emphasized, "From the moment of signing a housing contract, there needs to be an awareness to carefully verify rather than make hasty decisions." He said that beyond simply obtaining the certified copy of the register and land ledger, one must now meticulously check the construction date, occupancy status, whether the floors above and below are vacant, who is renting, and any tax arrears. He recommended, "If it is difficult to do alone, consult in detail with experts such as judicial scriveners first and verify together."

I met Lee Nam-chul, President of the Korea Certified Judicial Scrivener Association, at his office in Gangnam-gu, Seoul, to hear the judicial scrivener's perspective on the jeonse fraud case. Photo by Huh Young-han younghan@

Jeon Se-sagi victim Baek Iseul is shedding tears at a press conference requesting a presidential meeting on measures against Jeonse fraud held near the Presidential Office in Yongsan-gu, Seoul on the 20th.
[Image source=Yonhap News]

Amid the recent deaths of three victims of jeonse fraud in Incheon, on the morning of the 18th, a banner informing about the fraud was hung on the apartment main entrance door of the jeonse fraud victims in Michuhol-gu, Incheon.
[Image source=Yonhap News]

"Registration as 'Complete Public Notice,' Granting Tenants the 'Right to File Auction Application'"

When asked about measures to prevent jeonse fraud, the association president found the answer in registration. He emphasized, "To enable tenants to have priority opposability, the three necessary elements?moving-in registration, fixed date registration, and moving details?must all be registered so that complete public notice can be achieved by reorganizing the system." He explained, "Complete public notice means that information about the house can be seen by everyone. Then, new tenants wishing to enter a multi-family house can comprehensively assess information about tenants on other floors, the homeowner's tax arrears, and confirm the order of interests to determine whether it is safe to move into the house."

He also anticipated that the recent significant change in social perception of registration would help achieve complete public notice. The association president said, "When the Housing Lease Protection Act was enacted in 1981, there was a strong tendency to view landlords and tenants as superior and inferior parties. The law was enacted to protect tenants who needed protection as the inferior party, but 40 years later, landlords are not always upper class, nor are tenants always lower class. Therefore, from the initial contract, it has become possible for both parties to cooperate and register to achieve complete public notice." He added, "The registration method itself has also become much simpler compared to the past when it was only possible through paperwork."

I met Lee Nam-chul, President of the Korea Certified Judicial Scrivener Association, at his office in Gangnam-gu, Seoul, to hear the judicial scrivener's perspective on the jeonse fraud case. Photo by Huh Young-han younghan@

Furthermore, the association president proposed granting tenants the 'right to file an auction application' as a stepping stone from registration reform. This is a post-jeonse fraud relief measure allowing tenants to directly apply for auction to the bank holding the mortgage if the homeowner cannot repay the money, enabling tenants to resolve the issue independently. Under current law, tenants must undergo prior procedures such as court trials to be granted this right, which is difficult in situations where quick recovery of funds and moving out are necessary. Also, since not all information is publicly disclosed in registration, tenants hesitate to file auction applications prematurely. However, if the right to file auction applications is granted, tenants can save more than a year compared to receiving a court judgment. With complete public notice through registration, tenants can apply for auction knowing all circumstances about the house, which is advantageous. The association president said, "I have been advocating this for over 10 years." He added, "Once the distribution procedure begins, things become very complicated. But using registration, both prevention and post-relief can be achieved simultaneously."

In addition, the association president emphasized, "While the mortgage loan ratio is around 40%, the jeonse deposit loan ratio is high at 80-90%, which is unbalanced. It is necessary to take time and adjust the balance step by step." He also advised, "The auction suspension period for affected houses has become too long, and if creditors cannot recover their claims, other side effects may arise in the financial sector. We should also consider measures such as bulk auctions rather than sequential auctions to prevent disparities in tenant damages."

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