Exorbitant 60,000% Interest on Small Loans... Malicious Loan Shark Organization Busted En Masse

A malicious private loan organization that lent money to economically struggling common people and charged interest rates as high as 60,000% was caught by the police.

A malicious private loan organization that lent money to economically struggling common people and charged interest rates as high as 60,000% was caught by the police. Seoul Metropolitan Police Agency

The Criminal Investigation Unit of the Seoul Metropolitan Police Agency announced on September 11 that it had apprehended 32 members of the loan shark organization on charges including violations of the Lending Business Act and the Debt Collection Act, and that 11 of them had been arrested.

According to the police, from July 2020 to November last year, the group is accused of providing ultra-short-term, high-interest loans to 103 victims in urgent need of cash, and engaging in malicious debt collection by threatening the victims’ family members and acquaintances if repayments were delayed.

They demanded that victims provide certified photos of loan agreements and the contact information of 10 family members or acquaintances as collateral, then lent small amounts ranging from 100,000 to 300,000 won. After six days, they imposed exorbitant interest rates ranging from 4,000% to 60,000%, as well as a daily “extension fee” of 50,000 won. For those unable to repay, they harassed and threatened family members and friends. If the delinquency continued, they posted the victims’ information and certified loan agreement selfies on social networking services (SNS).

The police launched their investigation in April last year, and between July and November of the same year, they conducted searches and seizures at the offices and residences of the organization’s members, securing 33 mobile phones, 22 laptops, and 168 pieces of evidence including loan-related ledgers. During this process, a member engaged in debt collection was also caught in the act and arrested.

According to the police investigation, the organization collected about 1.8 billion won from victims on a principal of approximately 710 million won. Of this, 1.5 billion won was subject to pre-indictment preservation measures. The group operated through non-face-to-face and unregistered lending methods, allowing only family, friends, and acquaintances to join.

A police official stated, “This case is a typical example of an illegal loan shark crime that exploits the economic difficulties of the working class. We will continue to strictly crack down on illegal private loan organizations targeting financially marginalized groups.”

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