A group that took out and stole tens of billions of won in jeonse funds with fake lease contracts has been referred to prosecutors en masse.
The Jeonbuk Provincial Police Agency's detective mobile unit said on the 16th that it had arrested and referred five main culprits, including a real estate broker surnamed A in their 50s, on charges including violating the Special Act on Public Housing and fraud. It also sent 83 people, including fake tenants, without detention.
A and others are suspected of signing 69 lease contracts for multiunit dwellings from 2021 to 2025 and swindling 8.5 billion won. They exploited the fact that loans are executed after a simple review if jeonse contracts and certified reports of housing lease contracts are submitted remotely, and was found to have recruited financially vulnerable people, such as those new to the workforce, as fake tenants.
After loans were executed by the Korea Land & Housing Corporation (LH) and financial institutions, they are believed to have received the jeonse deposits and split them among themselves. The fake tenants also kept the jeonse contracts in place without actually living there, turning the building into a "tin can jeonse," and, as a result, was found to have caused secondary damage in which actual resident tenants could not get their deposits back.
Police reportedly expanded the investigation after receiving intelligence that there was a group targeting jeonse loans. In the process, police secured fake contracts and financial transaction records and identified the structure of the crime.
A police official said, "After first arresting three main culprits, we additionally arrested two and referred the case," adding, "We will continue to respond strictly to crimes that exploit the jeonse loan system."