On the 23rd, it was reported that Joo Soo-doo, former chairman of the JYU Group and the main culprit in the '2 trillion won pyramid scheme' case, recently lost a lawsuit concerning equity in a Chinese corporation. Joo was sentenced to 12 years in prison after being arrested for a pyramid scheme in 2006. While serving his sentence, he received an additional 10-year prison term for another fraud case exceeding 110 billion won, and he is still incarcerated. He has been involved in several civil and criminal lawsuits during this time.
◇ "Court confirms loss in lawsuit asking to transfer equity of the bankrupt subsidiary's Chinese corporation"
The case in which Joo was confirmed to have lost this time was filed in 2023. JYU Network, a subsidiary of the JYU Group, was declared bankrupt in 2022 while being in arrears of 10.9 billion won in taxes. At that time, JYU Network was investing in Company A, a Chinese corporation, and made a contract to transfer "49% equity of Company A to Joo" just a day before the bankruptcy ruling. It is also said that this included the condition that "Joo would take on the debt for compensation claims against victims of the pyramid scheme amounting to 70 billion won."
In response, the bankruptcy trustee of JYU Network filed a lawsuit, stating that this contract should not be recognized. After the bankruptcy trustee won the lawsuit, Joo filed a counter lawsuit.
The first-instance court ruled, "Since Joo has not actually fulfilled the compensation debt to the victims, it cannot be deemed that JYU Network has gained any economic benefit." The court viewed that a contract from which only Joo benefits while the company incurs losses cannot be permitted. The second-instance court made the same determination. Ultimately, on the 18th of last month, the Supreme Court's first division (Chief Justice Noh Tae-ak) confirmed Joo's loss.
◇ While serving a total of 22 years in prison, retrial denied... also received suspended sentence for instigation of false accusation
Joo established the JYU Group and started a multilevel marketing business in 1999. He was arrested and indicted in 2006 for allegedly embezzling investment funds amounting to 2.1 trillion won from over 93,000 salespeople and misappropriating 28.4 billion won in company funds. He received a confirmed sentence of 12 years in 2007.
While serving his sentence in 2011, Joo applied for a retrial to reduce his sentence. The reason was that a person related to the JYU Group who testified in the trial was convicted of perjury. However, the court maintained the sentence, stating, "Even excluding the perjury part, the remaining evidence sufficiently establishes the crime."
While serving his sentence, Joo was also tried for other charges. In 2013, he was indicted while in prison for allegedly siphoning off investment funds of over 113 billion won from more than 1,300 victims by setting up another multilevel marketing company. For this case, he received a confirmed sentence of 10 years in 2020 and is still serving.
Joo was also tried for so-called 'self-accusation' charges. He reportedly instructed a lawyer to falsely accuse him of unpaid wages to avoid being transferred to another detention center while he was incarcerated at the Seoul Detention Center. As a result, Joo received a confirmed sentence of 10 months and a 2-year suspended sentence last year.
Joo has also filed several civil lawsuits. In 2008, he sued the government for damages, alleging that he suffered harm due to the National Intelligence Service's illegal information collection and false reporting, and won partially. Subsequently, he also won partially in a lawsuit against the National Intelligence Service demanding the disclosure of the relevant materials.
However, in a 400 million won damages claim lawsuit filed by over 400 victims of the pyramid scheme, Joo lost partially.