"North Korea Daedonggang Beer Venture": Yang Kyung-sook's Five-Year Prison Sentence Finalized for 3.3 Billion Won Fraud

Sentenced to Six Years in First Trial,
Reduced to Five Years on Appeal

Yang Kyung-sook has been sentenced to five years in prison for defrauding victims of more than 3.3 billion won by falsely claiming that she had obtained the rights to conduct material exchange projects with North Korea.

Supreme Court in Seocho-gu, Seoul. Photo by Yonhap News Agency

According to the legal community on September 2, the Supreme Court’s First Division (Presiding Justice Seo Kyung-hwan) recently dismissed Yang’s appeal and finalized the lower court’s sentence of five years in prison, upholding her conviction on charges of fraud under the Act on the Aggravated Punishment of Specific Economic Crimes.

Yang, a former programming director of the internet radio station “Radio21” who was previously sentenced to prison in the so-called “Democratic United Party Nomination Fraud Case,” was indicted for receiving a total of over 3.3 billion won from seven victims between December 2020 and March 2022. She had deceived them by claiming to have secured a business license for material exchanges between North Korea and South Korea, collecting funds from them under the pretense of investments and loans.

Yang promoted the so-called “Jangmadang Project,” which involved importing North Korean Daedonggang beer for sale in South Korea and producing masks with the profits to send to North Korea as aid. She misled victims by claiming that the project had been approved by the Ministry of Unification, guaranteed margin and minimum profits per mask, and offered exclusive mask supply and sales rights. To one victim, she promised a minimum return of 3 billion to 10 billion won in exchange for an investment of 1.45 billion won, actually receiving 977.25 million won from that person.

However, in reality, there was no business approval or unit price contract, and all she had obtained was acknowledgment of ‘North Korean Resident Contact Report’ from the Ministry of Unification. Yang created an appearance of a legitimate business by setting up broadcasting equipment in the office and handing out Daedonggang beer to victims. The funds she received were used for so-called ‘rob Peter to pay Paul’ payments to earlier victims, as well as settling personal credit card bills and purchasing cryptocurrencies. After the investigation began, Yang fled abroad but was later arrested as an illegal immigrant in China.

The main issues in the case were whether Yang had engaged in deceptive conduct such as providing false explanations of the business and promising to establish security interests, and whether the “Jangmadang Project” had any real substance or her intent to defraud could be recognized. The appropriateness of the sentence imposed by the lower court was also contested.

The trial court found that there was no substance to the project and that fraudulent intent was clearly established, and accordingly sentenced Yang to six years in prison. The court judged her actions as particularly egregious, noting her record of two prior prison sentences for similar fraud, and the fact that she fled overseas and was arrested as an illegal immigrant during the investigation.

The appellate court rejected Yang’s claim of factual error, but reduced her sentence to five years, taking into account that, during the appeal, a victim who had suffered damages of 510 million won reached a settlement and submitted a letter of non-punishment.

The Supreme Court accepted this decision. The bench ruled that the lower court had not erred by violating principles of logic or experience, nor had it exceeded the boundaries of free evaluation of evidence.

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