"Thought It Was Government-Supported Advertising"... Fair Trade Commission Refers 18 'Fraudulent Advertising Agencies' Targeting Small Business Owners for Investigation
by Oh Yukyo
Published 12 May.2026 10:02(KST)
18 Fraudulent Agencies, Including Those Impersonating Government Support Projects, Referred for Investigation
The Fair Trade Commission announced on May 12 that it held the first quarter review meeting of the "Online Advertising Agency Illegal Activities Response Task Force" and decided to refer 18 agencies, suspected of serious illegal activities among those with frequent reports filed through the Online Advertising Agency Fraud Reporting Center, to the police for investigation.
The agencies targeted for investigation mainly focused on small business owners and self-employed individuals who lacked access to information. Their schemes were meticulous and organized. The most common tactic involved impersonating a "government support project," deceiving business owners into believing that, as selected government beneficiaries, they could receive exceptional advertising benefits by paying only a partial fee, thereby inducing them to sign contracts.
Their conduct after signing contracts was even more unscrupulous. After promising that the business owner could pay a small monthly advertising fee over a year, they would, without the owner's consent, charge five years’ worth of service fees in advance or completely fail to deliver on promises of increased sales and full refunds. When business owners belatedly requested to terminate the contract, these agencies would bind them by demanding excessive penalty fees.
This investigation, in particular, uncovered numerous cases in which agencies—sharing the same brand, owner, or address—continued operating by simply changing their business names, effectively functioning as a single entity. The Fair Trade Commission determined that this was not a case of isolated misconduct by individual agencies, but rather an organized fraud operation, and requested the National Police Agency to investigate these entities collectively as a single organization through close cooperation.
The Fair Trade Commission cautioned, "Compared to advertising through traditional media (TV, radio, newspapers, etc.), online advertising offers higher cost-effectiveness, which attracts significant interest from self-employed business owners. However, the risk of disputes is high due to the unfair practices of some advertising agencies exploiting information asymmetry, so particular caution is required."
The Fair Trade Commission plans to continue regularly identifying agencies frequently reported for advertising fraud and requesting investigations by judicial authorities, thereby operating a comprehensive monitoring system.