Prison Sentences for Saemaeul Geumgo Executives After Receiving Billions for Arranging Regional Housing Cooperative Loan Extension

Executives of a local Saemaeul Geumgo credit union and others, who were brought to trial on charges of exchanging billions of won in money and valuables in return for arranging the extension of a regional housing cooperative loan, have been sentenced to prison terms.

Busan District Court. Asia Economy DB

According to the legal community on July 13, the Busan District Court Criminal Division 7 (Presiding Judge Shin Hyeongcheol) sentenced Mr. A, a legal office manager, and Mr. B, an executive director of a Saemaeul Geumgo credit union in Busan, to three years in prison each on charges including violation of the Act on the Aggravated Punishment of Specific Economic Crimes (mediation bribery). The court also ordered Mr. A to forfeit 550 million won and Mr. B to forfeit 281 million won.

They were indicted on charges of arranging a loan extension requested by a regional housing cooperative in Busan in 2023 and exchanging money in return. Mr. A, after being asked by the cooperative to help with the loan extension, requested assistance from Mr. B. Mr. B then introduced another executive director from a different Saemaeul Geumgo credit union in Busan, helping to extend the loan period by one year. After the extension was granted, Mr. A received 550 million won from the cooperative and passed 281 million won of this amount to Mr. B.

They argued that the money was compensation for services related to the loan extension and that the introductions were within the socially acceptable range. However, the court did not accept this argument. The court stated, "The work of financial institutions has a public nature and greatly affects national economic policy and the national economy. Therefore, strict punishment is necessary for acts that undermine the non-purchasable nature of such duties by exchanging money or valuables in connection with those duties."

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