People Power Party's Choi Hyungdu Raises Alarm Over Foreigner Phone Line Activations Becoming a Gateway for Burner Phones

Identity Verification Procedures for Foreigners Rendered Ineffective
Serious Illegal and Illicit Business Practices by Telecom Companies

Recently, 71 members of a phone fraud ring were apprehended by police for illegally collecting copies of foreign passports, using them to activate 11,353 prepaid SIM cards for budget phone services without authorization, and distributing these so-called "burner phones" to voice phishing organizations. Meanwhile, it has come to light that the three major mobile carriers in Korea have also been engaging in illegal and illicit business practices by activating foreigner phone lines with only a passport copy.

People Power Party lawmaker Choi Hyungdoo.

According to materials titled "Requirements for Foreigners to Open Lines under the 5G Standard Terms and Conditions of the Three Major Telecom Companies," submitted by the Korea Communications Commission to Assemblyman Choi Hyungdu of the People Power Party (representing Masanhappo, Gyeongnam) from the National Assembly's Science, ICT, Broadcasting, and Communications Committee, each carrier applies different standards for verifying the identity of foreigners. Some telecom companies have left loopholes that allow postpaid lines to be activated with just a copy of a passport.

The number of foreign residents in Korea has steadily increased from 2.03 million in 2020 to 2.65 million in 2024, with 2.04 million of them staying long-term (over 90 days). As of 2024, the proportion of foreign residents by nationality is China (36.2%), Vietnam (11.5%), Thailand (7.1%), the United States (6.4%), and others (38.7%).

Alongside this growth, demand for telecom services has also risen, prompting mobile carriers to aggressively market postpaid products to foreigners.

The core issue lies in the loopholes of identity verification when subscribing to postpaid products. While Korean nationals undergo thorough checks for forgery or alteration of IDs using dedicated scanners, foreigners can activate lines simply by scanning a passport, making it impossible to verify the authenticity of the copy. Ultimately, the process relies on the "integrity" of the sales outlet for identity verification.

This regulatory blind spot has resulted in the mass production of burner phones and the spread of voice phishing crimes.

As of July 2025, the financial losses from voice phishing have reached approximately 800 billion won, and are projected to surpass 1.3 trillion won on an annualized basis, marking an all-time high.

Furthermore, the number of burner phones detected under foreign names exceeded 70,000 cases in 2024 alone, exposing the structural flaws in the foreigner identity verification system.

The fact that more than 70,000 such cases were detected last year alone suggests that the problem is not merely criminal exploitation, but rather a structural defect in the foreigner identity verification process itself.

In the case of one telecom company, it was found that the company actively encouraged the submission of passport copies for 5G postpaid services as stated in its terms and conditions. This allowed for the recruitment of customers in countries such as Vietnam and Nepal without any in-person identity verification, and the automatic activation of services upon entry into Korea. There is evidence that SIM cards were sent out in advance, before entry into Korea, using only passport copies collected locally through employment or study agencies. This is a clear violation of the requirement for in-person identity verification and constitutes illegal business practices that undermine the obligation to verify identity at the time of contract.

For foreigners, it is generally difficult to activate postpaid SIM cards, which require procedures such as opening a bank account and credit checks. Therefore, most foreigners staying less than 90 days typically use prepaid SIM cards to access data and voice services during their stay.

However, this telecom company accepted passport copies from foreigners holding certain visas (E7 for specific activities, E9 for non-professional employment, D2 for study, D4 for general training) through local sending agencies (public institutions or agencies related to foreign employment or study abroad) before entry, and distributed postpaid SIM cards in advance.

Upon entry, these SIM cards were pre-activated for postpaid use, and after 2 to 3 months, when the foreigner received their alien registration card, the company would even process a change of ownership using only a copy of the registration card, without any in-person verification. This illegal business practice has been used to recruit foreign subscribers.

According to industry insiders, this business practice stems from the limited potential for attracting new postpaid subscribers among Korean nationals, leading carriers to turn their attention to foreigners. They pointed out that the promise of easy sign-up and postpaid benefits is being used as bait to attract foreign customers from overseas, in clear violation of identity verification procedures.

Unlike the strict verification process for Korean nationals, the activation of foreigner lines using only a passport does not involve thorough checks such as ID scanners, making it easy for sales outlets to commit illegal acts if they choose. This is strongly suspected to be linked to the recent surge in burner phones registered under foreign workers' names.

Assemblyman Choi Hyungdu stated, "The lax identity verification procedures for activating foreigner lines have become a breeding ground for the mass production of burner phones and the spread of voice phishing crimes." He emphasized, "The government must strengthen identity verification standards for foreigner lines and upgrade telecom companies' anti-fraud systems to prevent unauthorized subscriptions."

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