Mirae Asset Life Insurance's subsidiary, Mirae Asset Financial Services and PS Pine Service, is reported to have engaged 97 insurance planners in the 'PS Financial Ponzi scheme,' raising 140.6 billion won from 756 investors by means of illegal fundraising. Of this amount, 34.2 billion won remains unpaid.
The total number of people estimated to be involved in the lending company PS Financial Ponzi scheme is 371. Of these, 134 are insurance planners, and it has been revealed that they have been working at 28 GAs selling insurance products since the allegations of the PS Financial Ponzi scheme emerged.
According to the Financial Supervisory Service on the 23rd, the representative of the lending company PS Financial, Mr. Lee, established the GA PS Pine Service with 23 billion won and mobilized insurance planners to raise funds through illegal means.
Sixty-seven planners belonging to PS Pine Service raised 111.3 billion won from 415 individuals and failed to repay 29.4 billion won. Additionally, 30 planners from Mirae Asset Financial Services raised 29.3 billion won from 350 individuals and did not repay 4.8 billion won. They promoted themselves as financial and financial planning experts through social media (SNS) and recruited investment study participants, targeting young professionals interested in it.
They sold PS Financial products by claiming high returns if investors invested in 'short-term bonds issued by corporations' or 'lending company loan management products.' However, the actual contracts were conducted as 'lending agreements' where funds were directly loaned to Mr. Lee, and the investment amounts were deposited into his personal account.
The sales organization was structured in a pyramid with branch managers and subordinate sales agents. Sales agents received recruitment commissions based on their rank and sales performance. Lower-level agents would receive 3% of customer investment amounts, while upper-level managers would earn 0.2% to 1% of the recruitment amounts. Managers borrowed promotional strategies implemented by the GA for illegal fundraising. Most people involved in PS Financial, including Mr. Lee, are known to have previously worked as insurance planners.
However, as funding shortages began to occur at PS Financial from the second half of last year, representatives including Mr. Lee began selling high-interest products at an annual rate of 50% focused on insurance planners. Mr. Lee also instructed payment of the insurance recruitment commissions to be transferred to his account, and it has come to light that he used this money to cover debts.
The Financial Supervisory Service believes that insurance planners recognized this type of sales as illegal. The FSS noted, 'Despite clear suspicions of illegal fundraising due to excessive profit guarantees and ambiguity over the nature of investment products, as well as the transfer of investment funds to personal accounts, they continued illegal fundraising to receive commissions.' Additionally, planners utilized customer information (DB) gathered during their insurance sales activities to actively encourage insurance clients to invest.
The FSS determined that PS Pine Service failed to appoint a compliance officer, and that Mirae Asset Financial Services had inadequate punitive measures regarding SNS advertisements.
The FSS plans to impose severe sanctions on executives and insurance planners affiliated with PS Pine Service and will report them to investigative authorities. Mr. Lee, the representative of PS Pine Service, will face separate charges for embezzlement and other allegations. Personal sanctions and fines will also be considered against insurance planners who engaged in illegal fundraising using client information gathered for recruitment. Moreover, the agency plans to promote a memorandum of understanding (MOU) to strengthen internal controls at GAs and will separately punish unauthorized advertising activities.
A representative from Mirae Asset Financial Services said, 'We are currently in the process of terminating all personnel related to this matter and will reinforce internal controls to prevent recurrence, in line with directives from the FSS.'