Gyeonggi Province Charges Three Former and Current Executives of Real Estate Fellowship Cartel

Gyeonggi Province has charged three former and current executives of a real estate fellowship group in Yongin City for violating the Licensed Real Estate Agents Act. The group operated an exclusive cartel by forming a social association, prohibiting joint brokerage with non-member agencies, and expelling members who broke this rule. Gyeonggi Province plans to refer the case to the prosecution in June after completing its investigation.

The investigation began after a licensed real estate agent reported that a nearby fellowship group was restricting joint brokerage with non-member agencies.

According to Gyeonggi Province, the suspects operated a fellowship group made up of licensed real estate agents in Yongin City, explicitly stating in their internal code of ethics that "joint brokerage with non-member agencies is not allowed." They also imposed substantial sanctions, such as expulsion, on members who violated this rule.

In one instance, former chairperson A and secretary B directly confirmed that a member agency had engaged in joint brokerage with a non-member licensed real estate office. The following day, they expelled the member for violating the code of ethics.

Subsequently, successor chairperson C and secretary B visited multiple member agencies in person, instructing them not to engage in joint brokerage with non-member agencies and warning that transactions between members would be restricted if the rule was violated. Through these actions, they systematically blocked transactions with non-members.

In particular, the group took elaborate measures to avoid detection, fully aware of the illegality of their actions. Only the chairperson was allowed to keep a copy of the internal code of ethics, which was strictly forbidden to be copied or photographed. Members were informed of the rules only orally or through temporary viewing, rather than via electronic media or documents. Additional unfair business restrictions were also found, such as designating certain days as collective holidays and prohibiting commission discounts. As a result, non-member agencies suffered actual business losses, repeatedly being denied joint brokerage opportunities, while member agencies also faced psychological pressure and a decline in brokerage activities due to fear of sanctions.

Types of Exclusive Cartels by Licensed Real Estate Agents in the Yongin Area

Article 33, Paragraph 1, Subparagraph 9 of the current Licensed Real Estate Agents Act strictly prohibits licensed real estate agents from forming groups that limit joint brokerage with non-members. Violations are punishable under Article 48, Subparagraph 3 of the same law by imprisonment for up to three years or a fine of up to 30 million won.

Kim Yongjae, Director of Land Information at Gyeonggi Province, stated, "This case is a typical example of a brokerage market cartel, where a private group's internal rules were abused to systematically exclude non-member agencies from the market and block free competition. Such unfair practices are clear violations of the law, as they infringe upon consumers' right to choose listings and access brokerage services. We will continue to track and investigate similar cases."

Meanwhile, since February of this year, Gyeonggi Province has been participating every two weeks in the "Real Estate Illegal Activity Response Council" organized by the Office for Government Policy Coordination, where it shares investigation and prosecution updates on real estate illegal activities, such as price collusion, with the Ministry of Land, Infrastructure and Transport, the National Police Agency, the National Tax Service, and other related agencies, and discusses inter-agency cooperation measures.

In May, six owners of an apartment complex in Hanam City were referred to the prosecution for violating the Licensed Real Estate Agents Act, on charges of colluding to fix apartment sale prices through a private KakaoTalk open chatroom and obstructing the business activities of licensed real estate agents.

This content was produced with the assistance of AI translation services.