Incheon Michuhol-gu Jeonse Damage Amount 200 Billion Won... Assemblyman Heo Jongsik Calls for Monitoring Auction Winners

by Park Haesook

Published 20 Apr.2023 16:30(KST)

As the number of victims of jeonse fraud is increasing nationwide, concerns have been raised about the need to monitor successful bidders after auctions are completed.

On the 20th, Heo Jong-sik, a member of the Democratic Party of Korea (Incheon Dong-gu Michuhol-gu Gap), urged for monitoring of auctions during the National Assembly Transportation Committee plenary session, stating, "Recently, as auctions for (jeonse fraud houses) are in full swing, auction hunters are flocking and monopolizing all the properties among themselves."

In response, Won Hee-ryong, Minister of Land, Infrastructure and Transport, replied, "The presidential office is monitoring to ensure that auctions by financial institutions are all suspended starting today."

However, there are concerns that another 'housing king' could emerge through buildings whose auctions have been completed.

There are testimonies that auction items are failing in the first and second rounds, and from the third round onwards, a specific group of more than ten people bids, making it difficult for tenants to win the auction.

Heo's office also revealed reports that, in some auction-related group chats, advertisements stating "If you win the auction, we will pay a commission" have been posted, and real estate consulting firms are gathering mainly in areas affected by jeonse fraud.

Heo said, "Since early this year, I have urged institutional improvements regarding auction and public sales delays, but only after victims (who took extreme measures) appeared one after another did the president order the suspension of auctions. The ineffective measures and delayed responses by government authorities are exacerbating the situation," emphasizing, "Since the jeonse fraud issue is an event beyond common sense, measures beyond common sense must be prepared."

At the full meeting of the National Assembly's Land, Infrastructure and Transport Committee held on the 20th, Democratic Party lawmaker Heo Jong-sik is questioning Minister of Land, Infrastructure and Transport Won Hee-ryong.
[Photo by Heo Jong-sik's office]

Meanwhile, according to a survey conducted by Michuhol-gu, Incheon, from the 6th of last month to the present, the estimated number of affected households is 2,484, and the estimated damage amount reaches 200.2 billion KRW. Additionally, voluntary auctions (mortgage execution auctions) are underway for 1,531 units, and 92 units have been sold.

According to Incheon City, three individuals known as the so-called 'Construction King,' 'Villa King' (deceased), and 'Young Villa King' (deceased) own a total of 3,008 houses in Incheon.

By region, Michuhol-gu has the most with 2,523 houses, followed by Gyeyang-gu with 177, Namdong-gu with 153, Bupyeong-gu with 112, Seo-gu with 32, Jung-gu with 4, Yeonsu-gu with 3, Dong-gu with 3, and Ganghwa-gun with 1.

The city is investigating the damage situation, including checking with the relevant autonomous districts whether auctions are proceeding, as most of these houses are believed to be involved in jeonse fraud.

In particular, in Michuhol-gu, where the most jeonse fraud victims have occurred, three victims of the recent 'Construction King jeonse fraud' have taken extreme measures one after another.