Singer Kim Jae-hee (54), who performed as the vocalist for the rock band Boohwal, was handed over to prosecutors on suspicion of involvement in illegally raising investment funds worth about 200 billion won.
According to the Incheon Metropolitan Police Agency on the 23rd, Kim was among 69 members of a group sent to prosecutors on charges including violating the Act on the Regulation of Conducting Fund-Raising Business Without Permission and fraud under the Act on the Aggravated Punishment of Specific Economic Crimes.
Earlier, police arrested A (43) and B (44), co-CEOs of the company behind the crimes, and referred 67 alleged accomplices, including Kim, who was in charge of attracting investors, to prosecutors without detention.
The group is accused of operating 35 branches nationwide from Dec. 2022 to Aug. last year and collecting 208.9 billion won in illegal investment funds from 30,000 investors. So far, 306 victims of the fraud have been identified, with losses estimated at 19 billion won.
Kim served as the company's vice chair and inside director and also attended business briefings held across the country. Kim did not invest directly in the business but was found to have promoted the company's business to briefing attendees and even sung at the events.
In return, Kim is believed to have taken 100 million won as salary, a passenger car worth about 60–70 million won at market price, and valuables worth around 80 million won.
The group recruited investors by promising principal and high returns, and was found to have continued the crimes using a so-called "Ponzi scheme" (multi-level financial fraud) method, in which new investment funds are used to pay revenue to existing investors.
However, Kim reportedly denied the allegations in a police interview, saying Kim did not know it was a fraudulent scheme.
Kim was the fourth vocalist of the rock band Boohwal and participated in Boohwal's third and fourth albums. Kim is also the younger sibling of the late Kim Jae-gi, the band's third vocalist.