The Association of Certified Appraisers Conducts Special Inspection to Identify Corporations Suspected of Jeonse Fraud

[Asia Economy Reporter Noh Kyung-jo] The Korea Association of Property Appraisers announced on the afternoon of the 10th at the Property Appraisers Hall in Bangbae-dong, Seocho-gu, Seoul, that it has unveiled the "Measures to Eradicate Jeonse Fraud and Improve Appraisals for Safe Jeonse Support."

This is in line with actively cooperating with the "Jeonse Fraud Prevention and Damage Support Measures" announced earlier this month at the whole-government level, and aims to strengthen the fairness and reliability of appraisal work related to the Jeonse Deposit Return Guarantee.

Exterior view of the Appraisal Society Hall in Bangbae-dong, Seocho-gu, Seoul / Photo by Korea Association of Property Appraisers

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The improvement measures include ▲support plans for implementing government policies ▲special inspections of Jeonse Deposit Return Guarantee appraisals ▲exclusion of inappropriate appraisal firms from work ▲establishment of a continuous monitoring system ▲mandatory registration in the precedent information system to prevent inappropriate appraisals ▲strengthening ethics education and self-purification campaigns ▲operation of a reporting center for suspected Jeonse fraud cases ▲and the introduction of designated appraisers for objective appraisals.

The association has been operating the "Safe Jeonse Counseling Center for Ordinary Citizens" since the 2nd of this month. It reviews the market prices of apartments with fewer than 50 households, as well as row houses and multi-family houses, whose prices cannot be checked through the Safe Jeonse application. A support team has also been formed to assist in verifying prices of newly built villas before completion.

On the 14th, a special task force of the Ethics Coordination Committee will be formed. Its role is to conduct special inspections of firms or offices that have concentrated on Jeonse Deposit Return Guarantee appraisals or have habitually failed to register appraisal precedents. The inspection results will be shared with the Ministry of Land, Infrastructure and Transport, and sanctions such as disciplinary actions or restrictions on association recommendations will be imposed if necessary. Inappropriate firms will be excluded from the 40 appraisal institutions selected by the Housing and Urban Guarantee Corporation (HUG).

A continuous monitoring system will also be established. Samples of Jeonse Deposit Return Guarantee appraisal reports will be randomly extracted to review their appropriateness, and cases of poor quality will be shared with the Ministry of Land, Infrastructure and Transport. Depending on the severity of the issue, the association plans to take strict measures through the ministry beyond its own actions.

Additionally, mandatory registration in the precedent information system, strengthening ethics education and self-purification campaigns, and operation of a reporting center for suspected Jeonse fraud cases will be implemented. This allows appraisers to immediately report any suspected Jeonse fraud situations discovered during their work. Furthermore, only verified appraisers meeting certain criteria will be allowed to perform appraisal work related to Jeonse guarantees through the introduction of "designated appraisers."

Yang Gil-su, president of the association, stated, "We will make every effort as professional qualified appraisers to protect the public from Jeonse fraud and fulfill our social responsibility. We will do our best to cooperate not only in improving appraisals related to Jeonse guarantees but also in all government-wide policies aimed at protecting Jeonse tenants."

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