Head of Illegal Private Lending Operation Escapes Police Referral... Sent to Trial After Supplementary Prosecution Investigation

Some Organization Members Confess,
Additional Charges Filed Against Lawyer for Instigation of Perjury

The ringleader of an illegal private lending business, who had previously avoided referral to prosecution due to insufficient evidence during the police investigation, has now been indicted and will stand trial in custody following a supplementary investigation by prosecutors.

Front view of the Seoul Northern District Prosecutors' Office. Photo by Yonhap News

On September 10, the Criminal Division of the Seoul Northern District Prosecutors' Office (acting chief prosecutor Woo Man-woo) announced that Mr. A, the ringleader of the illegal private lending business, has been indicted and detained on charges including violating the Lending Business Act and subornation of perjury. Four others, including attorney Mr. B, have been indicted without detention. Two organization members who admitted to the crimes were given suspended indictments.

According to the prosecution, from February 2020 to June 2021, Mr. A and his organization members are accused of issuing a total of 1.13 billion won in 1,130 loans to 161 borrowers without registering their lending business, and collecting repayments amounting to approximately 700 million won.

Previously, in January 2022, the police referred the organization members for prosecution during their investigation into the case, but decided not to refer Mr. A. At that time, the organization members reportedly denied that Mr. A was involved in the crimes.

During the trial against the organization members, the prosecutor in charge repeatedly questioned witnesses about the existence of the ringleader and any conspiracy, cross-checking their statements. The prosecution also consistently presented evidence contradicting the organization members' testimony.

A turning point came when some organization members confessed to prosecutors about Mr. A's existence and his involvement in the crimes. Based on these statements, the prosecution launched a supplementary investigation and confirmed Mr. A's involvement in illegal private lending.

The prosecution questioned the individuals involved and searched Mr. A's residence and other locations. On August 6, Mr. A was detained and indicted for violating the Lending Business Act.

The investigation also uncovered evidence that organization members were instructed to testify falsely. Attorney Mr. B reportedly met with organization members multiple times and advised them, "If you admit to conspiracy, the punishment may be harsher, so testify that you acted alone."

The prosecution found that Mr. B instigated perjury and indicted him without detention for subornation of perjury. Some organization members who gave false testimony have also been indicted for perjury. However, the two members who confessed to the crimes received suspended indictments.

Meanwhile, one person registered as a legal lender, who had only been questioned as a witness during the police investigation, was additionally identified. This individual allegedly registered the lending business at Mr. A's request and helped Mr. A and the organization members run illegal lending operations under the registered company’s name.

The prosecution plans to confiscate approximately 100 million won in proceeds Mr. A gained from the illegal private lending, and is pursuing options to return the funds to the victims.

A representative of the prosecution stated, "We will ensure the integrity of the prosecution and prevent substantive truth from being concealed through perjury," adding, "We will do our utmost to reinforce the principle that lies have no place in court and that false testimony will have consequences."

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