The South Korean precious metal shopping mall, which is currently operating normally on the Internet trading site despite being unable to deliver or refund, has come under sanction from the Fair Trade Commission, including business suspension. Last year, this site received a correction recommendation for "ceasing violations" from the local government managing telemarketing firms and accepted it, yet it failed to implement the recommendation. In response, the Fair Trade Commission decided to report the corporation and its representative to the prosecution.
On the 5th, the Fair Trade Commission imposed a corrective order (including a public announcement order) along with a 4.5-month (135 days) business suspension and a fine of 7.5 million won on the Korea Precious Metal Exchange for violating the electronic commerce law, and decided to report the corporation and its representative to the prosecution.
The Korea Precious Metal Exchange is an online shopping mall that sells precious metal products such as gold bars, silver bars, gold coins, and silver coins. Although it may appear to be a credible institution by name, it is actually a general individual shopping mall. Consumers reported that between January 2022 and August of last year, products were not delivered and they "withdrew their applications," but the payment amounts were not refunded or took longer than the legally prescribed 3 business days to get their money back, resulting in damages. The estimated related damage amounts are approximately 2.16 billion won, including 760 million won in unrefunded payments and 1.4 billion won in delayed refunds.
As similar cases of damage were received in large numbers, the Korea Consumer Agency issued a "consumer damage warning" in December 2023. Since then, the online shopping mall has falsely and exaggeratedly claimed in its notices that "refunds are being processed normally." It also hindered withdrawal of applications by notifying consumers that exchanges and returns were impossible.
As issues continued, the head of Byeollae-dong in Namyangju, which oversees the business site's location, issued a corrective recommendation to the Korea Precious Metal Exchange stating, "Cease violations such as unrefunded payments, and implement necessary measures to prevent and remedy consumer damage." Although the company accepted this, it did not properly implement the corrective recommendation, only taking necessary actions for some consumers.
In response, the Fair Trade Commission decided to report the Korea Precious Metal Exchange and representative Kim to the prosecution for violating the electronic commerce law. According to the law related to consumer protection in electronic commerce, violators can face up to 3 years in prison or a fine of up to 100 million won. Meanwhile, Kim is also under investigation for fraud. In October of last year, the police referred Kim to the prosecution.