Violation of Korean law (Fraud)

2. B

Attorney Kim Young-hun (Defendant B)

The summary of the judgment against the Defendants is published.

A. Defendant A’s violation of the Act on the Aggravated Punishment, etc. of Specific Economic Crimes (Fraud): Defendant A is the F’s representative director who leased DD 107, D 111, and D 112, located in Gangnam-gu Seoul, Seoul, from April 17, 2014 to E Co., Ltd. (hereinafter “Co.”), and the F Co., Ltd. is a corporation established for the purpose of lending the above D 1 billion won capital to the amount of KRW 1 billion.

In order to rent a store for sale specialized in the sports zone, the injured party's bank for the settlement of disputes (hereinafter referred to as the "victim's company") participated in the consultation with the "FF" in December 2, 2014 in order to enter into the lease agreement in D 107 area. Defendant A notified the victim company's representative director in G stores located in Gangdong-gu Seoul Metropolitan Government (FF office before February 12, 2015) to the effect that "G D 107 area sales deposit has been determined" was paid to the victim company's representative director in the G stores located in Gangdong-gu Seoul Metropolitan Government (hereinafter referred to as "FF office") on February 11, 2015, and that "G 107 area security deposit was settled" and "the payment of the balance between the victim and the 500,000,000,000,000,000 won was not made to the 50,000,000,000 won.

However, on February 11, 2015, Defendant A received a written confirmation of salesroom occupants from the victim company and submitted an official letter to the Dispute Resolution Co., Ltd., but on February 11, 2015, Defendant A was notified that it is impossible to approve the salesroom occupants of the said company’s employees on February 11, 2015, and Defendant A would not have any intention or ability to return the money even if Defendant A had the victim company move to move to D107 zones or receive the down payment from the victim company due to financial difficulties, such as the failure to receive monthly salary from the representative director from September 2014.

Nevertheless, Defendant A deceptioned the victim company as above and obtained 500 million won from the victim company to the F account on February 12, 2015, as the down payment under the instant contract.

B. The defendants' violation of the Act on the Aggravated Punishment of Specific Economic Crimes (Fraud) (hereinafter "Act on the Aggravated Punishment of Specific Economic Crimes") is the representative director of the company in charge of the settlement of accounts (hereinafter "L") and the defendant A is the representative director of F who was established for the purpose of leasing business as the subsidiary of the above company for the purpose of leasing business while he was employed as a director by the above company.

On January 19, 2015, the Defendants conspiredd with the victim on January 19, 2015, “The lease deposit amount to be paid to the party to the dispute resolution committee, which is 3 billion won, shall be paid by January 26, 2015, if the Defendants lent KRW 500 million to the party to the dispute resolution committee, and would be repaid by January 26, 2015.”

However, the Defendants, in the name of F on September 15, 2014, concluded a lease agreement with E-U.S. in the name of F to KRW 3 billion and did not pay the remainder of the lease deposit amount of KRW 2.7 billion, which was determined on the date of the outstanding payment of the lease deposit, even after the date of the lease contract, which was determined on December 1, 2014, when the lease contract was concluded with E-U.S. in the name of F, the Defendants were notified from E-U.S. in several times of the payment of the remainder of the lease deposit, delayed interest, monthly rent, and the termination of the contract. Meanwhile, the Defendants’ company did not pay the employees’ wages from the pre-U.S. company from around 2014 to E-U.S. company’s repayment of the remainder of the lease deposit with the intent of returning the down payment due to the performance of the contract between the Defendants and E-U.S. company and the contractor, which was difficult to pay the remainder of the lease deposit to E-U.S.

Nevertheless, the Defendants deceptioned the victim as above and obtained a bill of KRW 500 million from the victim, i.e., a cashier’s checks from the victim.

2. Judgment on the violation of the Act on the Aggravated Punishment, etc. of Specific Economic Crimes (Fraud) by Defendant A (2015 high-scale 1174)

In light of the following circumstances acknowledged by the evidence duly adopted and examined by the court, it is insufficient to recognize that the above facts charged are proven beyond a reasonable doubt that the Defendant, with the sole evidence submitted by the prosecutor, deceiving J which was in charge of practical affairs concerning the contract of this case as the representative director of the victim company or as the employees of the victim company, by deceiving the victim company to acquire 500 million won of the down payment of the contract of this case from the victim company.

A. It is difficult to deem the Defendant to have committed deception. The part which constitutes deception in the instant facts charged is that “the Defendant made a false statement concerning the determination of salesroom occupants in the victim company”, and that “the Defendant did not have an intention or ability to make salesroom occupants in the victim company D107 area,” and that “the Defendant did not have an intention or ability to return the down payment.”

1) There is no evidence to deem that a false statement was made in connection with the determination of saleroom occupants.

A) In the facts charged of this case, it is deemed as follows: “The defendant directly determined D107 district occupants of the victim company at the time of the conclusion of the contract of this case,” and thus, first, whether the victim company’s side (I, Q, and J) at the time of the F Bank of the Dispute Resolution (B, Defendant, and P) including the defendant is accurately defined in the victim company (I, Q, and J).

(1) In full view of the statements made by the following relevant persons, it is recognized that at least the Defendant expressed his/her intent to the extent that it would be approved through P, unless there is any special reason to the J, at least by the time of the conclusion of the instant contract.

① At this court, P, who was in charge of the practical affairs concerning the instant contract for F, stated that, prior to the conclusion of the instant contract, there was no written approval from the Defendant in writing from the Defendant, but it would be approved as the salesroom of the victim company unless the working-level officer in charge of the dispute resolution committee raises any special objection, and that it would be the same as if the salesroom of the victim company was approved.

The J stated that in this court, before the submission of the victim company's shop occupants' intent, the victim company made oral statements to the effect that "the shop occupants of the victim company were determined in the E (State)."

③ At this Court, I stated that, prior to the conclusion of the instant contract, F was reported by the person in charge of the victim company to the effect that “F was confirmed orally by the resolution committee for the settlement of the victim company.”

(2) However, in light of the following circumstances, the evidence alone submitted by the prosecutor is insufficient to recognize that the Defendant directly concluded that the Defendant had settled D107 district occupants as stated in the facts charged, as stated in the facts charged, with I and J.

① As indicated in the facts charged, the Defendant stated that there was no fact that the Victim Company had established D107 district occupants.

② Even if the first victim company’s statement and the statement made in the process of investigation as the victim company’s agent were examined, it is included only in the victim company’s statement that P stated that “F has obtained approval for the shop occupants of the victim company orally from the Dispute Settlement Bank Co., Ltd.,” and that prior to the conclusion of the instant contract, it is not entirely included in the content that the Defendant made the victim company’s statement as to whether to grant direct approval for the shop occupants at the H shop of the victim company (2015 Gohap 111, 214-219, hereinafter referred to as “the investigation records of the case”) (3) the victim company’s side (I, Q, and J) did not mention that there was a conversation between the victim company and the PJ on the approval of the shop occupants on April 2015.

④ In this Court, the J stated that prior to the conclusion of the instant contract, the Defendant could not directly listen to the fact that the Victim Company’s H store could not directly hear the Defendant’s statement on whether to approve the saleroom occupants.

B) As such, the Defendant expressed his intent to the effect that “the salesroom of the victim company will be approved through P unless there is a special reason to the J” at the time of entering into the instant contract cannot be deemed to have made a false statement on the part of the victim company, taking into account all the circumstances at the time as follows.

(1) At the time of the conclusion of the instant contract, K did not officially notify the victim company's approval of the location D107 district occupant as stated in the facts charged to K, and E did not specifically oppose the victim company's location location D107 district occupant.

① From this court, K in charge of the business affairs concerning the approval, etc. of D's D's shop occupants as an employee of the Dispute Resolution Co., Ltd., stated that, the reason why K did not officially receive D's official document on February 11, 2015, F is not because there was any defect or problem in the victim's company itself, but it was merely because K's at the time, without prior consultation with E's own, made a notification that F will arbitrarily divide D 107 zones into two areas, and the other company, other than the victim company, will move into two enterprises, and that F will not approve the shop occupants of the victim company before February 12, 2015.

② In addition, there is no other evidence that E’s refusal to receive the above official questioning from February 11, 2015 is due to the victim’s objection to the company itself.

(2) In light of the existing sales approval practices of D, it was difficult for E to expect that E would oppose the future sales of the victim company.

(1) There was no special objection to the company that had intended to make the L-A-B-B-B-B-C-B-B-B-B-U.

L Around 2013, when the overall remodeling of D was conducted from around 2002 to about 10 years, L had leased D stores from the LAD to the LAD and had other companies enter into a business by selling them. During the said remodeling process, F and E were separately established from the end of 2013 to the beginning of 2014, and the F and E AB Co., Ltd actually agreed to succeed to the existing lease relationship between L and E (the completion of the said remodeling and the opening of D around November 27, 2014).

However, in this court, the defendant, K, and L, the representative director of the dispute resolution committee, all of which are the defendant, K, and L, stated that, for about 10 years, the LAB agreed to the effect that the LAB had no special objection to the LAB in the process of having the LAB leased D stores from the LAD and let other companies operate the business.

(2) No one who intends to approve only the salesroom occupants of clothing-sale enterprises in the zone D,107.

Even according to the lease agreement of March 15, 2014 between E and KF, the dealing goods of the company that is scheduled to move in to D107 area are described as ‘pact, miscellaneous, etc.', and it cannot be concluded that the victim company does not necessarily correspond to this.

② Even after the conclusion of the instant contract, on February 24, 2015, the Additional Agreement was concluded between E and F, the type of business and the item to be handled by the E-107 company wishing to move to the D107 zone.

CK failed to make a consistent statement at any time in this court as to when E expressed its intent to approve only the shop occupants of the company selling the clothing in the zone D107.

2) It cannot be deemed that there was no intention or ability to allow the victim company to rent the company.

In light of the existing sales approval practices of the parties to the dispute resolution plan as above, as long as it was difficult for the defendant to anticipate that the parties to the dispute resolution plan would oppose the sales of the victim company in the future, it cannot be concluded that the defendant did not have any intent or ability to move the victim company into the D107 area at the time.

3) It cannot be deemed that there was no intention or ability to refund down payment. Since the 'R' brand located in D 112 area prior to the conclusion of the instant contract had been determined on February 6, 2015, which was already located in D 112, and attracting other companies in D 107 areas, it was much more easy to attract other companies. Thus, there is sufficient room for the Defendant to believe that it is difficult for the Defendant to return down payment to the victim company even without the consent of the victim company’s occupant occupant.

① In the process of consultation on new store leasing, etc. after completion of D remodeling with L/L, E, focusing on the rapid impact of salesroom occupants of “R” brand salesrooms on their surrounding stores or attracting enterprises, E, with the content that “D12 areas to be newly leased must be occupied by “R” and “D12 areas shall be excluded if L is lost in attracting “R” brands, and if L is lost in attracting “R” brands, it shall be excluded from leased objects.” Thereafter, E, which is operated and managed new D on behalf of E, continues to be emphasized through the agreement on December 10, 2013 between F and the lease contracts on March 15, 2014 or brands on November 28, 2014, and brands on January 15, 2015.

② On August 19, 2014, in the process of remodeling construction, the operator of the Dispute Resolution Co., Ltd. (Sju, which operated the business by selling the "R" brand in the existing store leased by the Dispute Resolution Co., Ltd.) expressed to the operator of the Dispute Resolution Co., Ltd. that he would no longer occupy the "R" brand in the D shop scheduled to be newly leased by the Dispute Resolution Co., Ltd., and the Defendant made continuous efforts to meet the requirements required by the "R" brand by again attracting the "R" brand. As a result, the existing attitude was changed to determine the "R" brand in the D12 area leased by F Co., Ltd. from the Dispute Resolution Co., Ltd. (F) through a contract signed by February 6, 2015 between the operator of the Dispute Resolution Co., Ltd. (F) and the occupant of the "R" brand in the D112 area leased by F Co.

③ Therefore, as long as the issue of ‘R' brand sales, which was the most controversial issue between Eju and Eju, was resolved, it was difficult to think that E, even though the other brand sales company did not approve the sales of the victim company, the Defendant was able to raise an objection to E, and even if E, 'R' brands are not approved, 'R' brands are adjacent to D 112 zones where the victim company's sales are scheduled to be sold, and it was believed that the victim company can prepare the down payment to be returned to the victim company after again attracting other companies in D107 zones.

(4) In fact, around March 6, 2015, F has achieved the outcome of entering into a contract with “U” brand to sell in D107 zones instead of the victim company, on the basis of D112 zone salesroom occupants, etc. of the “R” brand. However, it seems that E ultimately expressed its intention to terminate the lease agreement itself on March 15, 2014 between the LAF and the LAF, thereby failing to return the instant down payment to the victim company.

B. It is difficult for the victim company to have caused the conclusion of the instant contract and the payment of down payment by deceiving the Defendant.

1) Article 18(4) of the instant contract expressly states that, after the conclusion of the instant contract, if E does not approve the shop occupants of the victim company, the victim company should comply with it, and the LAF shall return the money paid from the victim company. This provision is premised on the fact that EAB may not approve the shop occupants of the victim company even after the conclusion of the instant contract.

2) In this Court, both parties and J clearly stated that at the time of the conclusion of the instant contract, they had been aware of the fact that the parties to the instant contract did not approve the sales of the victim company through the document. In addition, in this Court, the J stated that Article 18(4) was included in the instant contract in preparation for the refusal to approve the sales of the victim company due to the circumstance that the parties to the instant contract did not officially approve the sales of the victim company at the time of the conclusion of the instant contract.

3) As such, the victim company is aware of the circumstance that there is a risk of refusing the approval of the tenant at any time after the conclusion of the instant contract, but it is difficult to deem that the victim company had entered into the instant contract and paid the down payment, as long as the victim company necessarily transferred the instant contract to the Defendant through P, it is difficult to conclude the instant contract and pay the down payment. In addition, it is difficult to deem that the Defendant had the intention to acquire by deception.

1) As seen earlier, it is difficult to view that there was an intentional acquisition by the Defendant at the time when comprehensively considering the progress of the discussions between the F and E-the-counter dispute resolution committee, the position of the E-the-counter dispute resolution committee at the time, the existing salesroom approval practices of D, D112, the situation where the salesroom of D112 became final and conclusive, and the content of the victim company’s expression of intent delivered by the victim company.

2) Even if the F’s substantial decision-making structure or the Defendant’s actual profit from the instant down payment is considered, it is difficult to find the reason for the Defendant to acquire money by deceiving the victim company.

① In full view of the statements made by the Defendant, B, and J in this court, since the Plaintiff, a single shareholder, was a company that was established by investing funds for the special purpose of the D-B rental business, the F-B, not the Defendant, the representative director of F-B, but the representative director of the L-B, made an important decision on the operation of L-B, and the Defendant was merely a role in executing the decision made by B.

② Some of the down payment KRW 500 million was used as the operating fund of the L in the instant case, and the remainder was decided to sell in D107 zones before the victim company, and was paid as the refund of down payment to the abandoned company, so there is no profit that the Defendant personally acquired through the instant contract.

3. Determination on the Defendants’ violation of the Act on the Aggravated Punishment, etc. of Specific Economic Crimes (Fraud) (2016 Highis848)

A. In a loan for consumption, if the lender and the borrower are aware of the credit standing of the borrower due to a special personal relationship or transactional relationship, etc., and the lender is or could have anticipated risks associated with the future default or impossibility of repayment, it refers to an important matter that can be determined by the borrower as to whether to make a transaction, such as the specific intent of repayment, ability of repayment, and transaction terms at the time of the loan. Barring any such circumstance, barring any circumstance, it cannot be readily concluded that the borrower deceivings the lender about his/her ability to repay or that there was an intent to defraud the borrower (see, e.g., Supreme Court Decision 2012Do14516, Apr. 28, 2016).

B. Examining the following facts in light of the aforementioned legal principles, the evidence submitted by the prosecutor alone cannot be deemed to have been proven beyond a reasonable doubt that the Defendants deceptioned the victim at the time of borrowing KRW 500 million from the victim, or the Defendants had the intent to defraud the victim.

1) The victim could have anticipated the risk of default or impossibility of repayment.

A) Facts of recognition

According to each of the following facts, according to the legal statements of Defendant A and B, each of the legal statements of the witness P and V, each of the legal statements of the witness P and V (the evidence list Nos. 2016, 848 case No. 2, hereinafter referred to as "nets") and the sales contract (the No. 4), the LA audit report of the company (the No. 30), and the investment contract and the sales contract (the No. 40) between F and 0 on January 8, 2015, the following facts are acknowledged.

① From the end of 2014, the victim had worked in a savings bank for at least 17 years, and from the end of 2014, the Defendants and the Defendants had been engaged in negotiations on the investment in, or the sub-loan of part of, the instant company. On January 1, 2015, the victim confirmed that Defendant AC received the financial statements, audit report, and confirmation of the lease status, etc. of the instant company. On January 8, 2015, the victim and the instant company entered into an investment contract with the Defendants. (The victim did not pay KRW 500,000 to the Defendants in full, but did not pay KRW 50,000,000 to the Defendants. However, the victim’s financial statements, etc. were confirmed at the time of the instant company’s investment, not in the process of lending KRW 500,000,000,000,000,000 to the extent that the Defendants did not believe the financial status of the said company.

② The instant company is a corporation that operates shopping malls by leasing a store from the Dispute Resolution Co., Ltd., and operates the shopping mall or operates the store, etc., and from around 2013, it was entirely unable to rent D stores due to overall D remodeling. In addition, the audit report of the financial statements for the fiscal year 2013 of the Dispute Resolution Co., Ltd., which was confirmed by the victim, indicated that the auditor's "limited opinion" is expressed, and the “The Dispute Resolution Co., Ltd., as a complete capital erosion that exceeds its assets, has an important uncertainty that may cause significant doubts in the capacity of continuation as a continuing company.”

(3) At the time of the victim’s preparation of an investment contract with the Defendants, the Defendants were in need of the balance of the lease deposit amount to be paid to the E-U.S. In order to maintain the D lease agreement, which is a premise for the continuation of the business of the instant company. However, in addition to the method of receiving an investment from a third party, the Defendants did not have any way to prepare the balance of the lease deposit amount of KRW 2.7 billion (the victim was well aware of such circumstance), and accordingly, tried to prepare the lease deposit by receiving an investment of KRW 1 billion from the victim and KRW 1.7 billion from W.

④ On January 8, 2015, the aggrieved party renounced the investment of KRW 1 billion under the Investment Contract, and W did not make an investment of KRW 1.7 billion.

⑤ After that, on January 19, 2015, the victim borrowed KRW 500 million to the Defendants by setting the rate of interest on delay as 5% a day after the due date of payment seven days, and at the same time, received KRW 20 million from the Defendants at the interest rate of seven days prior to the due date of payment.

④ In relation to the method of repayment of KRW 500 million, the Defendants stated that “W shall pay the amount of KRW 2.7 billion to the Defendants as the lease deposit, and thereafter leased D stores to a third party, and the Defendants later leased D stores leased from the E-Coordination Bank to a third party and repaid KRW 500 million to the victims as the lease deposit to be received from the others.” However, at the time, at the time, the Defendants did not specify who would be the third party to transfer D stores from the Defendants, and W’s investments did not eventually result in KRW 2.7 billion.

B) Determination

Considering the following circumstances revealed by the above facts, the victim seems to have anticipated the risk of default or impossibility of repayment at the time of lending KRW 500 million to the Defendants.

① At the time of lending KRW 500 million to the Defendants, the victim was aware of the financial position and business prospects of the instant company operated by the Defendants.

① The victim tried to invest a large amount of KRW 500 million in the business of the instant company operated by the Defendants for a long time prior to the lending of KRW 500 million to the Defendants. The victim was aware of the financial status and business prospects of the instant company by confirming the financial statements, etc. of the instant company or identifying how to use the investment funds.

① Ultimately, the victim appears to have waived investment in concluding that the pertinent company’s financial position is not good and business prospects are inappropriate through the above process. In short, the Defendants were aware of the company’s financial position or business prospects, thereby lending KRW 500 million to the Defendants for the purpose of the company’s business-related funds. In light of the objective loan conditions, such as the repayment period and interest rate for the above KRW 500 million, the victim seems to have been at any level at the risk of payment system for KRW 500 million or the impossibility of repayment.

① The repayment period for a loan of KRW 500,000 is very shorter in light of the amount of KRW 500,000,000 from the loan date to the seven days after the loan date, and the interest rate of KRW 500,000 per annum (60% per annum) is higher than the interest rate under the Interest Limitation Act, and the victim also received KRW 20,000 as the interest prior to the date of repayment.

The victim, who had been engaged in the conduct of the operation, had been working in the savings bank for at least 17 years, is generally deemed to have been fully aware of the fact that the borrower’s credit was not good and the risk of default or default was high.

③ The method of repayment of KRW 500 million known to the victim was also uncertain.

The method of repayment of KRW 500 million presented by the Defendants is premised on W’s investment in KRW 2.7 billion to the Defendants. However, as W had been reversed even before that date, there was no objective basis for securing W’s investment in KRW 2.7 billion in addition to the Defendants’ horses. In fact, W did not have any investment in KRW 2.7 billion. Even if W invested in KRW 2.7 billion, at the time, the third party was not determined at the time to rent D stores from the Defendants. Accordingly, the period of repayment or at any time after the maturity or after the maturity, at the time of lending whether W would be able to repay KRW 500 million to the victims.

2) It is difficult to deem that the Defendants were falsely aware of the important matters by which the Defendants would decide whether to trade with the victim.

This part of the facts charged contains the part that the Defendants, with respect to the use of 500 million won as part of the terms and conditions of transaction, intended to use the loan deposit to be paid to the pre-existing shop occupants as refund for termination of the contract, but the victims notified the victims of the use as the balance, etc. of the lease deposit to be paid to the pre-existing shop occupants. In this court, the victims stated to the effect that they would not lend KRW 500 million to the pre-existing shop occupants.

However, according to each of the statements in the complaint statement (No. 1) and the statement in the statement (No. 2), it is acknowledged that the defendants were stated that the defendants borrowed KRW 500 million from the victim simply due to ‘temporary managerial shortage'; ② each statement prepared by the defendants and the victims when entering into a loan agreement for consumption of money to KRW 500 million includes only the term of redemption, overdue interest rate, and provision of collateral; and the purpose of the loan is not specified as ‘the balance, etc. of lease deposit to be paid to E-the-counter Bank'. It is true that the defendants stated that the defendants did not state the purpose of the loan consistently from the investigative agency to this court, and the victim stated that the defendants did not state the purpose of the loan consistently; and as seen above, the victim was aware of the fact that the defendants sought KRW 2.7 billion to pay the lease deposit to E-the-counter bank in the process of taking into account the investment with the defendants, so the defendants could not have paid the loan deposit to the defendant as part of the facts charged by the prosecutor.

In addition, the Defendants’ use KRW 500 million from the victim as the remainder of the lease deposit against E as well as using it as the refund for the termination of the contract for the shop occupants who concluded the D shop sub-lease contract with the Defendant is necessary to continue the business related to the D shop of the instant company. As such, there is no substantial difference between the Defendants in terms of the use of the loan. In light of the uncertainty of the loan repayment method as seen earlier, there is no possibility that the former would repay more than the latter.

In addition, even if the defendant stated that the victim would not have lent KRW 500 million to the defendants, it is difficult to conclude that the victim would not lend to the defendants, even though the defendant, at the time, the use of the borrowed money, to the preexisting shop occupants.

At the time of borrowing KRW 500 million from the Defendants, it is difficult to view that the Defendants made a false representation of important matters to determine whether to use the borrowed money or not.

3) The Defendants believed that the business could continue and had the intent to repay KRW 500 million to the victims.

According to the witness 0's legal statement, 0's police statement (No. 30), and 74 million won including the victim's interest from January 19, 2015 to June 30, 2015, the Defendants paid 500 million won in total to the victim, including the victim's interest, 20 million won.

As seen above, in addition to the fact that the Defendants made an additional agreement to maintain the D Lease Agreements with the E-U.S. on March 9, 2015 to maintain the D-U.D lease agreement and made efforts to continue to engage in D-U rental business, such as buying-out stores by R-U., etc., the Defendants believed that, at the time of borrowing KRW 500 million from the victim, the Defendants did not have good financial standing of the instant company at the time of borrowing KRW 500 million from the victim, the Defendants were able to continue to pay KRW 500 million to the victim through continuing the business.

4. Conclusion

Since all of the facts charged in the instant case constitute a case where there is no proof of crime, a judgment of innocence is rendered against the Defendants pursuant to the latter part of Article 325 of the Criminal Procedure Act, and a summary of the judgment is publicly announced pursuant to Article

Judges of the High Instance

Judges Kim Dong-dong