Another 5.7 billion won jeonse scam in Seoul… Police arrest and send to prosecution two landlords

In South Korea, despite being unable to repay the housing deposit (chonse), he defrauded 42 tenants, including new employees, of a total of 5.7 billion won (approximately 588 million yen) worth of housing deposits.
The Gwanak Police Station in Seoul arrested and sent a rental business owner A (55 years old) and landlord B (46 years old) on suspicion of fraud last month, and indicted C (
A, 46, was sent to the prosecution in mid-January without even leaving his home. A borrowed a total of 5.1 billion won (approximately 1.2 billion won) from 38 tenants, including new employees, despite not being able to repay the housing deposit.
Landlord B is suspected of receiving housing deposits worth a total of 600 million won (approximately 62 million yen) from four tenants, including new employees.
According to the police, Mr. A has bought six buildings over a three-year period since 2018 without investing much of his own capital, by taking over the mortgages on the buildings and the housing deposits of the tenants.
He continued to deceive his victims by pretending that he could repay the housing deposit to the existing tenants whenever he could, even though he had no ability to do so if he could not find a new tenant.
Mr. B also had a mortgage on the building he purchased without any capital, and was unable to fully guarantee the tenants' housing deposits. However, he made false statements about the priority deposits.
He is accused of receiving a total of 600 million won in deposits from four victims. The number of "housing deposit frauds" in which deposits are not returned even after the rental contract has ended is on the rise, and HU
The amount of subrogated payments made through the Housing and Urban Guarantee Corporation's jeonse fund guarantee insurance is expected to decline from 504.1 billion won (about 52 billion yen) in 2021 to 3.9948 trillion won (about 41 billion yen) last year (2024).
The police are investigating not only "capital-less gap investments," but also fraud by false landlords, trust real estate rentals, and other fraudulent methods, which have become more diverse and sophisticated.
Recently, there has been a rise in "simultaneous" fraud, in which the housing deposit is used to cover not only the purchase price but also the commission to real estate agents and registration fees.
In response to this, the Seoul Metropolitan Police Department (Gwanak Police Station) has been operating a task force (TF) to strengthen its response to jeonse fraud since November last year, and has reported a total of 49.1 billion won in damages in four months.
The prosecution has sent 81 suspects to the prosecution for a case involving a total of 5 billion yen in jeonse fraud.
"We are cracking down on jeonse fraud, which has become a social problem and has caused suffering to ordinary people and new employees," said Choi In-gyu, police chief of Gwanak-gu district.
I will do my best."