Lenient laws make Korea a ‘heaven for crooks’
Starting a new life in Incheon in the early 1990s, Park worked day and night bouncing from job to job. He was a sales clerk and even a bus driver.
In 2007, he met a man who promised to make him rich. He said he sold medical equipment and needed an investment - which would pay handsome returns. Park invested 4 million won ($3,400). Seeing his bank account swell up as promised, he then invested 120 million won more.
In 2008, Park realized that his business partner was Cho Hee-pal, who was soon to be named Korea’s most notorious con artist. From 2004 to 2008, Cho scammed some 5,000 investors out of a total of 4 trillion won before being busted by local police.
Cho fled to China in December 2008. Police claim he died three years later without a clear answer to where all the money went. Victims of his pyramid scheme established the Citizen’s Coalition for Respectable Household Economy (CCRHE) and are still fighting to get their money back.
So far, the fight has been in vain.
“I never really dreamed of becoming rich,” Park lamented.
“I fell into this scheme wanting to keep my wife home,” he continued. “Now, I’m sick in bed and she’s the only one earning bread for the entire family.”
Of course, Cho was not the only con artist that Korea has seen in recent years. One thing common to most cases of fraud is that the money is usually not recovered.
In 2014, 64 percent of the 244,008 fraud cases reported to police ended up with victims not getting a penny back. Only 1 percent of the victims’ money was retrieved. Some 8 trillion won was lost to fraudsters that year, and only 73 billion won was reclaimed.
Advanced technology and the interconnectedness of Korean society has enabled swindlers more anonymity and more ways to trick people. Legal pundits say it’s time the country try to tackle fraud in a new way - by imposing heavier penalties.
Two out of every five people (38.8 percent) in Korea who commit fraud are repeat offenders, according to a report by the Supreme Prosecutors’ Office last year. In contrast, only 12.4 percent of people involved in “severe crimes” such as murder or robbery are repeat offenders.
“Con artists tend to grow attached to this kind of scam because they mostly get away with probation from courts,” said Roh Myung-sun, a professor at Sungkyunkwan University Law School.
“[Korean society] is mass-producing charlatans by giving them the perception that they can spend a couple of years in jail,” said Jeon Se-hun from CCRHE, “and come back out to start a stable life all over.”
CCRHE claims that among the plaintiffs in 185 civil cases filed against Cho, not a single person has retrieved any money.
Shin Eui-gi, who heads the economic and commercial crime research division at the Korean Institute of Criminology, believes domestic laws are “so lax” that a person who could get a 30-year jail term in Japan gets only three years in Korea.
For Kang Sin-yeong, 43, whose father was victimized by a fraudster from 2000 to 2012, the country’s lenience toward fraud cases is hard to bear.
“Reading books was all he ever did,” Kang said of his father. The elder Kang, a former English professor at Pusan National University in Busan, died in 2013 of pancreatic cancer. He was 70.
The older Kang was one of 5,500 professors who were swindled by the Korea Professor Mutual Society out of a total 680 billion won. The credit union, which was established without the Financial Supervisory Service’s notice, siphoned off its members’ investments.
“I never knew he invested that much money [339 million won] until after the police stepped in,” Kang said. After the fraud was cracked down on, his father got back only 14 percent, or about 50 million won.
The case is still ongoing in court.
“He changed a lot after that incident,” Kang said. “He was a devout Christian who attended early morning prayers his entire life. During his last years, I remember him staring at the computer screen all day monitoring an online community of similar victims.”
As for Park, who lost his fortune to Korea’s most notorious hustler, Cho Hee-pal, he was diagnosed with colorectal cancer in June 2012 and has since undergone four surgeries and rounds of chemotherapy.
He still firmly believes Cho is alive - and that the police are concealing his whereabouts.
Park’s conclusion: “This country is a heaven for crooks.”
BY HAN YOUNG-IK, YOON JEONG-MIN AND KIM MIN-KWAN [firstname.lastname@example.org]