Rental Deposit Fraud Ring Busted for Stealing Hundreds of Billions Using Straw Buyers

A group behind a large-scale rental deposit fraud scheme, which used straw buyers to steal hundreds of billions of won in deposits from hundreds of villa tenants in the Seoul metropolitan area, has been handed over to prosecutors.

Yonhap News Agency

The Financial Crimes Investigation Unit of the Seoul Metropolitan Police Agency announced on the 18th that it had referred 71 individuals, including the chief recruiter and buyer brokers, to prosecutors without detention on charges of fraud.

They are accused of stealing a total of 69.3 billion won in deposits from 306 tenants by using 306 villas in Seoul, Gyeonggi, and Incheon as bait between May 2020 and October 2022.

According to the police, the suspects committed the crime using a "zero-capital simultaneous transaction scheme," in which they used straw buyers-who had no intention of actually purchasing the villas but only lent their names-to sign lease contracts.

Unlike the usual method, where a single rental business operator purchases multiple villas and signs lease contracts to receive rebates, the suspects recruited straw buyers who lent their names due to financial hardship.

They received illegal profits totaling approximately 1.8 billion won by collecting rebates ranging from 200,000 won to 15 million won per transaction from consulting agents.

Each straw buyer purchased one or two villas, so the crimes did not appear on the "HUG List of Malicious Landlords" or as targets for investigation by the Ministry of Land, Infrastructure and Transport. Even when tenants filed criminal complaints, the cases were treated as civil matters related to non-fulfillment of deposit payment obligations, allowing the suspects to evade crackdowns and investigations.

A police official stated, "We plan to strictly crack down on rental deposit fraud that disrupts the sound order of the housing market and undermines the livelihoods of economically vulnerable citizens."

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