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Seoul police arrest 12 for alleged loan-sharking scheme

Published: 11 Dec. 2025, 16:07 Updated: 11 Dec. 2025, 16:25

A computer is seen in a Daegu apartment used as an office by an online illegal lending ring that charged borrowers an annual interest rate of 12,000 percent before being arrested by police. [YEONGDEUNGPO POLICE PRECINCT]

Seoul police arrested 12 people suspected of running an online lending scheme that charged annual interest rates up to 12,000 percent, far above the legal cap, and used threats to force repayment, authorities said Thursday.

The group allegedly lent around 520 million won ($353,000) to 173 people through Telegram, KakaoTalk and other social media platforms, then collected interest that ranged from 4,000 percent to as high as 12,000 percent per year, according to police. The legal limit is 20 percent.

The Yeongdeungpo Police Precinct arrested them on charges that included violations of lending, debt collection and interest-rate cap laws. Four of the suspects are in custody.

Police say the alleged ringleader recruited accomplices in the Daegu area, often persuading middle and high school acquaintances with promises of making “big money.” The group targeted borrowers who struggled to obtain bank loans and demanded personal photos and contact details of acquaintances instead of collateral.

Investigators say the suspects pressured borrowers who fell behind on payments by sending messages to their acquaintances, making claims such as that the borrowers frequented nightlife establishments, or by posting the borrowers’ photos on social media. They also threatened to sexually abuse a borrower’s elementary school-aged child.

Luxury watches, cases and shopping bags seized by police while arresting members of an illegal lending ring at an apartment in Daegu are seen in this photo provided by Yeongdeungpo Police on Dec. 11. [YEONGDEUNGPO POLICE PRECINCT]

Police raided the group’s office in August, arresting five suspects and seizing mobile phones, laptops and 2.39 million won in cash. Officers arrested five more suspects on Dec. 2 at their homes and seized an additional 2.6 million won. The alleged ringleader and another alleged orchestrator remain in detention on unrelated loan sharking charges.

Police plan to refer the five recently arrested suspects to prosecutors this week, adding to the seven already transferred.

“We will continue investigations to root out illegal lending, usury and abusive debt collection practices targeting low-income borrowers,” the police official said.

This article was originally written in Korean and translated by a bilingual reporter with the help of generative AI tools. It was then edited by a native English-speaking editor. All AI-assisted translations are reviewed and refined by our newsroom.
BY OH SAM-GWON [[email protected]]