(b) Fraud;

Attorney EX, EHI

1. Regarding ground of appeal No. 1

A. The representative director of a company who withdraws and uses a large amount of company funds for purposes other than expenses for the company for purposes of provisional payment, etc. without having agreed on interest or maturity for payment, and without undergoing a resolution of the board of directors, etc., does not constitute embezzlement by arbitrarily lending and disposing of company funds for private purposes beyond the generally acceptable scope (see, e.g., Supreme Court Decisions 2003Do135, Apr. 27, 2006; 2010Do3399, May 27, 2010). In addition, the intent of unlawful acquisition in the crime of occupational embezzlement refers to the intention of disposal of other person's assets in violation of his/her occupational duties, such as having been actually or legally disposed of, or having intent to reimburse or preserve them later (see, e.g., Supreme Court Decision 2003Do3345, Jun. 27, 2006).

However, in the crime of embezzlement, the intent of unlawful acquisition intent refers to the intent of the custodian of another’s property to dispose of it by himself/herself without authority contrary to the purport of entrustment. As such, in cases where the custodian disposes of it for the benefit of the owner, not for his/her own or a third party, barring any special circumstance, the intent of unlawful acquisition intent cannot be recognized. Therefore, barring any special circumstance, where the representative director of the company provides explanation about the location or location of the money used for the illegal acquisition, and where there are materials corresponding thereto, the intent of unlawful acquisition was embezzled with the intent of unlawful acquisition, barring special circumstances (see, e.g., Supreme Court Decisions 2007Do4784, Feb. 26, 2009; 2011Do1904, Feb. 26, 2011).

Meanwhile, the prosecutor bears the burden of proving the existence of an act of embezzlement in the crime of occupational embezzlement. Such proof must be based on strict proof that leads to a judge’s lack of reasonable doubt. If there is no such proof, even if there is doubt as to the defendant’s guilt, it should be determined with the defendant’s interest (see, e.g., Supreme Court Decisions 2007Do9318, Aug. 21, 2008; 2010Do9627, Jul. 14, 2011).

B. On the grounds indicated in its reasoning, the lower court determined that the Defendant’s act of using the provisional payment or short-term loan (hereinafter “provisional payment”) on behalf of K Co., Ltd. (hereinafter “K”) or for a business fund promoted by K does not present evidentiary documents on its place of use, and the Defendant could not withdraw the provisional payment with the intent of unlawful acquisition and use it for personal purposes. The Defendant cannot be deemed to have withdrawn the provisional payment with the intent of preserving the provisional payment after temporary use, and the Defendant’s act of withdrawing the provisional payment or with the intent of preserving it cannot be seen as having withdrawn the provisional payment, and the lower court’s determination that the Defendant’s act of using the funds for private purposes does not affect the crime of embezzlement already established on the sole ground that the Defendant had a separate claim against K, and it is difficult to accept the lower court’s decision that the Defendant’s act of acquiring the funds for the aforementioned private purposes constituted the crime of embezzlement regardless of the resolution of the board of directors (hereinafter “Defendant’s unlawful acquisition”). Furthermore, it is difficult to accept the lower court’s judgment that the Defendant’s intent of embezzlement 166.

(1) The reasoning of the lower judgment and the record reveal the following facts.

(A) The Defendant, while proceeding with K through K, carried out the instant investment project, together with the project, such as CK, EB, DI (K held 42.96% shares) and W Speaker (hereinafter “the instant investment project”). To this end, the Defendant transferred money from K account or the Defendant’s account to CK, etc.’s account.

(B) The prosecutor initially prosecuted the Defendant from K’s capital to CK Co., Ltd. for embezzlement of KRW 15 million on June 21, 2006, KRW 200 million on July 27, 2006, KRW 26,50 million on March 26, 2007, KRW 13,300 million on EB Co., Ltd., DI, and KRW 12,000,000 on February 2, 2009 by using W’s investment funds for each of the above money. However, the prosecutor was charged for embezzlement of KRW 27,59,68, and KRW 116, and KRW 4,000 on each of the above money by using W’s investment funds for the purpose of each of the investment funds. However, in light of the purpose of this case’s investment funds as stated in the list of crimes (1) in attached Table 27,59,68, and 116, and the list of crimes (2).

(C) In addition, on June 13, 2007, after deposit of KRW 300 million from the K account to the Defendant account, 300 million was remitted from the Defendant’s account to DI account. On February 2, 2009, after deposit of KRW 50 million from the Defendant’s account to the Defendant’s account, the deposit of KRW 120 million was made from the Defendant’s account to W IB account. The flow of such funds also supports the recognition of the above facts as to the place of the use of the instant provisional payment and its use.

(D) If the first instance court spent K’s funds to the instant investment project in accordance with reasonable management judgment for K’s interest, it is difficult to evaluate the expenditure itself as the expression of intent to obtain unlawful acquisition, and rendered a not-guilty verdict on the facts charged of embezzlement of the pertinent funds, and maintained the judgment as it is, because the prosecutor did not appeal. In light of this, such determination can be deemed as it is if the instant provisional payment, etc. was used for the purpose of investment funds for the instant investment project.

(2) In full view of the above facts, if the provisional payment of the instant investment project, etc. was made in the Defendant’s account using the form of provisional payment, etc. for the convenience of financial transactions as part of investing or lending funds to the instant investment project, etc., and the said provisional payment is likely to have been made again by means of remitting the instant investment project to the instant investment project entity, and there are transaction data related thereto, and if the instant provisional payment, etc. was made within the scope of reasonable management judgment, it cannot be deemed that K’s funds were directly disbursed to the instant investment project. Therefore, it is reasonable to deem that the instant provisional payment, etc. does not go against the purpose of entrustment or interest of K.

Therefore, the lower court should not readily conclude that the instant provisional payment, etc. was used for the personal purpose of the Defendant solely based on the circumstances cited by the lower court, but should have examined whether there are other special circumstances that support the Defendant’s embezzlement of the instant provisional payment, etc. with the intent of unlawful acquisition, notwithstanding the aforementioned legal doctrine.

Therefore, the court below erred by misapprehending the legal principles as seen earlier and failing to exhaust all necessary deliberations, which affected the conclusion of the judgment, by finding that the Defendant could withdraw the provisional payment, etc. from the intent of unlawful acquisition and use it for personal purposes. The part of the ground of appeal pointing this out is with merit.

D. Meanwhile, examining the reasoning of the lower judgment in light of the evidence duly admitted, the lower court’s determination on the remainder of the provisional payment except for the instant provisional payment is consistent with the aforementioned legal doctrine. In so doing, contrary to what is alleged in the grounds of appeal, there were no errors by misapprehending the legal doctrine regarding the intent of unlawful acquisition in embezzlement, or by exceeding the bounds of the principle of free evaluation of evidence against logical and empirical rules

2. As to the ground of appeal No. 2, an act of a person who keeps and manages money, etc. on behalf of another person by entering into a construction contract with a construction business operator, etc. at an excessive amount than an appropriate amount to raise funds to be used for his/her personal purpose, and thereby making a prior agreement with the construction business operator to enter into the construction contract and return part of the overpaid construction price paid therefrom from the construction business operator constitutes embezzlement in relation to the other person (see, e.g., Supreme Court Decision 2010Do

The lower court, on the grounds indicated in its reasoning, determined that the Defendant paid the CD Co., Ltd. sales advertising fees by paying the sales fees, and that the Defendant was sufficiently recognized as embezzlement by returning KRW 1 billion among them.

Examining the reasoning of the lower judgment in light of the aforementioned legal doctrine and the evidence duly admitted, the lower court did not err in its judgment by violating logical and empirical rules and exceeding the bounds of the principle of free evaluation of evidence, or by failing to exhaust all necessary deliberations.

3. Regarding ground of appeal No. 3

For the reasons indicated in its holding, the lower court determined that the Defendant, on the grounds indicated in its reasoning, embezzled the purpose and purpose of termination, by receiving KRW 2 billion, which is strictly limited to the purpose of use and purpose of use from AA, including collateral security.

Examining the reasoning of the lower judgment in light of the evidence duly admitted, the lower court did not err in its judgment by exceeding the bounds of the principle of free evaluation of evidence against logical and empirical rules, or by misapprehending the legal doctrine on embezzlement and intent of unlawful acquisition, as alleged in the grounds of appeal.

4. Regarding ground of appeal No. 4

The lower court, on the grounds indicated in its reasoning, determined that the Defendant was sufficiently recognized as having received a loan by deceiving the Credit Guarantee Fund by manipulating the financial documents of W Council members in a situation where it is difficult for the Defendant to obtain a credit guarantee or loan in a normal way.

Examining the reasoning of the lower judgment in light of the evidence duly admitted, the lower court did not err by misapprehending the legal doctrine on the intentional deception and causation in fraud.

5. Scope of reversal

Of the judgment of the court below, the part of the violation of the Act on the Aggravated Punishment, etc. of Specific Economic Crimes (Embezzlement) with respect to K is partly reversed as above, and all of the reversed guilty part and the remaining guilty part and the part of the judgment of the court below which the court below judged as not guilty are related to a comprehensive crime. Therefore, the part of the violation of the Act on the Aggravated Punishment, etc. of Specific Economic Crimes (Embezzlement) with respect to K in the judgment of the court below should be reversed in whole. In addition, since the guilty part of the violation (Embezzlement) of the Act on the AA of Specific Economic Crimes (Embezzlement) with respect to K in the judgment of the court below is sentenced to a single sentence due to the concurrent crimes under the former part of Article 37 of the Criminal Act and the crime of violation of the Act on the AA

6. Conclusion

Therefore, the entire conviction part of the judgment of the court below is reversed, and this part of the case is remanded to the court below for a new trial and determination. It is so decided as per Disposition by the assent of all participating Justices on the bench.

Justices Lee Sang-hoon

Justices Kim In-bok, Counsel for the defendant

Justices Kim Gin-young