A. Violation of the Act on the Aggravated Punishment, etc. of Specific Economic Crimes (Misappropriation)

(b) Violation of the Commercial Act;

(c) False entry in the original notarial deed;

(d) Exercising the original notarial deed;

E. Performance of official duties by fraudulent means

1. (a) b. (c) d. A;

2. b. (c) d. B

Conscepts (prosecutions) and former citizens (public trial)

A Law Firm (private ships for Defendant A)

Attorney B (Korean National Assembly for Defendant B)

March 27, 2013

Defendant A shall be punished by imprisonment with prison labor for a year and six months, and by imprisonment with prison labor for a period of six months.

However, with respect to Defendant B, the execution of the above sentence shall be suspended for two years from the date this judgment becomes final and conclusive.

Criminal facts

【Criminal Power】

On December 23, 2011, Defendant A was sentenced to the suspension of the execution of two years in the Busan District Court for a violation of the Act on the Aggravated Punishment, etc. of Specific Economic Crimes (Misappropriation of Trust). The above judgment was finalized on December 31, 201.

[Criminal Facts]

Defendant A was a victim D (D at the time of establishment of August 14, 2007) located in Seo-gu Busan, Seo-gu, Busan, but 2008.

8. The name was changed on August 2007; hereinafter referred to as the "victim company")'s promoters from August 2007 to the head of the business headquarters; from April 30, 2009 to January 18, 2012, the representative director of the victim company was appointed; and Defendant B from August 13, 2007 to January 13, 201, the victim company's promoters.

4. A person who served as a representative director of the victim company until 30.

1. The Defendants’ co-principal

The Defendants decided to open a new fishery products wholesale market at the Busan City-Scheon Port, and presented the criteria for the designation of a wholesale market corporation that will be in charge of its operation, 'the corporation that has secured the capital of at least 10 billion won', and offered to be designated as a wholesale market corporation by pretending to meet the above requirements as if the existing paid-in capital were paid-in capital after withdrawing it in the form of circular investment.

(a) Promoters, directors, other officers, etc. violating the Commercial Act shall not pretend to make payments or investments in kind;

Nevertheless, on November 22, 2007, the Defendants withdrawn a total of KRW 3.4 billion from the capital of KRW 4 billion paid to the victim company until that time, and around that time, establish a theory in the name of Section E in the name of the head of the victim company’s business.

After investing in “F”, Defendant A was treated as lending to “G”, the representative of Defendant A, but around November 27, 2007, deposited 3.4 billion won as share capital in the corporate passbook of the victim company in the name of “G”.

Accordingly, the Defendants conspired to make payments as promoters of the victim company.

(b) Making false entries in the original notarial deed and uttering of the original notarial deed;

On November 28, 2007, the Defendants made a false report to the registered public official on the commercial register, which is the original copy of a notarial deed, and exercised it by having the registry official whose name is not known, keep the register in which the above facts of the notarial deed are recorded at around that time, by having the public official make a false report on the registered public official on the registration of the Busan District Court and the office of the Busan District Court, for the modification that the total amount of capital of the victim company was increased to 4.2 billion won, even though it was actually increased to 7.6 billion

C. Performance of official duties by fraudulent means

On December 10, 2007, the Defendants submitted to the public official in charge of examining wholesale market corporations the commercial register stating the false statement that the total amount of the capital actually paid to the victim company until that time is 7.15 billion won, although the total amount of the capital actually paid to the victim company was 7.155 billion won, the Defendants submitted the commercial register to the public official in charge of examining wholesale market corporations. (Provisional Designation Date: December 31, 2007) On May 30, 2008, the victim company was designated as a wholesale market corporation.

As a result, the Defendants conspired to interfere with the legitimate examination of the public official in charge of designating wholesale market corporation by fraudulent means.

2. The sole criminal conduct of Defendant A;

Since August 2007, Defendant A had a duty to take overall control of the business of the victim company as the head of the headquarters of the victim company and to handle the business for the benefit of the victim company.

Defendant A, as promoters of the victim company, personally borrowed KRW 2.75 billion in capital and paid it as capital. The method of paying the amount of the money to be paid out of the corporation’s funds, with the payment of the money as a pre-payment for listing the amount of money. On January 30, 2008, Defendant A, at the victim company’s office, submitted the document as if Defendant A paid the pre-payment for the quantity listing at H, the representative of the company, and submitted the document to the company, and received the money from 45 million UN (Korean Won KRW 398 million) to H corporation account from that time until July 22, 2008, as stated in the attached list of crimes in the attached list of crimes, Defendant A received the total amount of KRW 2.89,794,000 in capital and sustained property damage equivalent to that of the victim company.

Summary of Evidence

[Criminal Facts]

1. Defendants’ respective legal statements

1. Witness I and E in the third protocol of the trial; and witness I and E in the fourth protocol of the trial;

1. Each police statement concerning J, E, I, K, and L;

1. Resolution of the board of directors of D, F, the certified transcript of corporate register of G, the explanatory materials of corporation, the penology (A), each draft paper, each advance payment contract for quantity listing, each seal stamp, statement of transactions, advance payment details, Busan City Mayor's wholesale market and public notice, application for designation of wholesale market corporation, application for designation of wholesale market corporation and resolution of the board of directors;

1. Investigation report (Amount A Embezzlement)

【Criminal Power】

1. Application of Acts and subordinate statutes to the sending of the case, a copy of the judgment, and inquiry and inquiry about Defendant A;

1. Article relevant to the facts constituting an offense and the selection of punishment;

A. Defendant A: Articles 628(1) and 622(1) of the Commercial Act; Article 30 of the Criminal Act; Articles 228(1) and 30 of the Criminal Act; Articles 229 and 30 of the Criminal Act (a point of exercising the original in a notarial deed); Articles 137 and 30 of the Criminal Act (a point of exercising the original in a notarial deed); Articles 3(1)2 of the Act on the Aggravated Punishment, etc. of Specific Economic Crimes; Article 3(1)2 of the Act on the Aggravated Punishment, etc. of Specific Economic Crimes; Article 35(2) (a) of the Criminal Act; Articles 355(2) of the Criminal Act; each choice of imprisonment

B. Defendant B: Articles 628(1) and 622(1) of the Commercial Act; Article 30 of the Criminal Act; Articles 228(1) and 30 of the Criminal Act; Articles 229 and 30 of the Criminal Act (which means the exercise of the original notarial deed again in a notarial deed); Articles 137 and 30 of the Criminal Act (which means the obstruction of the execution of deceptive deeds); Articles 137 and 30 (which means the obstruction of the performance of the performance of deceptive deeds); Articles 628(1)

1. Handling concurrent crimes;

Defendant A: the latter part of Article 37 and Article 39(1) of the Criminal Act

1. Aggravation for concurrent crimes;

Article 37 (Aggravation of Concurrent Punishment, etc. of Specific Economic Crimes (Misappropriation of Trust) provided for in the former part of Article 37, Article 38 (1) 2, and Article 50 (In relation to Defendant A, the punishment of Defendant A shall be the largest penalty; the aggravated punishment of concurrent crimes concerning Defendant B shall be the heavier penalty provided for in the Commercial Act.

1. Discretionary mitigation;

Defendant A: Determination on Defendant A and his defense counsel’s assertion of favorable circumstances for sentencing under Articles 53 and 55(1)3 of the Criminal Act

1. Claim on the failure to commit a violation of the Commercial Act;

A. Summary of the assertion

Although Defendant A, as a representative of G, paid the share capital by depositing the above amount of KRW 3.4 billion borrowed from F in the victim company, Defendant A does not constitute a violation of the Commercial Act, since the said money was invested in the victim company in the form of circular equity investment, and then withdrawn or received the said money thereafter, Defendant A does not constitute a violation of the Commercial Act, and it does not constitute a crime of false entry in the original of an authentic deed, a crime of uttering of the original of an authentic deed,

B. Determination

The purpose of the crime of fictitious payment under Article 628 (1) of the Commercial Act is to regulate the act of taking advantage of the intent of the law that intends to secure the company's capital adequacy. Thus, in case where a company pays stock price in form or temporarily without intent to secure the company's capital through payment of the stock price, and the company withdraws the paid money immediately after obtaining a certificate of payment of stock price and completing the registration of incorporation after obtaining a certificate of payment of stock price, barring any special circumstance, the crime of fictitious payment is established since it is not actually increased the company's capital, but it can be deemed that the withdrawn money was used for the company, such as operating funds and office expenses of the company, or where it has already been used for the settlement of lending and borrowing relationship that occurred in the course of acquiring the company's capital or it is deemed that the withdrawn money was used with the acquired fund, and thus, it cannot be deemed that the company's capital adequacy has not been undermined (see Supreme Court Decisions 200Do1849, Dec. 19, 200; 2005Do1594.8.).

In light of the evidence and the above legal principles as seen earlier, the victim company collected shares equivalent to KRW 3.4 billion deposited in the name of G by the Defendants, and used them for the business of the victim company to use them for the business of the corporation of the victim. In addition to the share capital, there is room to view it as not impairing the victim company's capital adequacy.

However, the amount of KRW 3.4 billion deposited in G’s name is merely that the Defendants withdrawn the total amount of KRW 4.0 billion paid to the victim company, withdrawn the amount of capital of KRW 4.0 billion, and thereafter lent the money to G, and then deposited it in the victim company in G’s name. Therefore, even if the victim company’s capital was formally increased by KRW 3.4 billion, it cannot be deemed that the victim company’s capital has actually infringed on the victim company’s capital adequacy. Thus, the above assertion on the failure to commit the crime of violating the Act on the Aggravated Punishment, etc. of Specific Economic Crimes (Misappropriation of Trust) is groundless.

A. Summary of the assertion

At the time of committing the instant crime, Defendant A was only in charge of the overall business of the victim company as the head of the headquarters of the victim company and did not have any authority over the execution of funds. Defendant B, the representative director of the victim company, was the final approving authority in charge of the execution of funds. Therefore, Defendant A is not in the position of a person who administers another’s business, which

B. Determination

The essence of the crime of breach of trust is that a person who administers another person’s business has a duty to protect or manage another person’s property based on a bilateral fiduciary relationship. Thus, in the establishment of a crime of breach of trust, it does not require the actor to have a legitimate power to dispose of another person’s property in an external relationship (see Supreme Court Decision 97Do3219 delivered on September 17, 199). In light of the evidence mentioned above, Defendant A was the head of the headquarters of the business.

Although it is true that Defendant B, who was the representative director of the victim company, had been in the position of actual operator in charge of overall business of the victim company, such as operating the victim company with Defendant B and executing funds of the company, etc. Thus, even if Defendant A did not have a legitimate power of representation or power of representation to dispose of the company's property in external relations, the above assertion does not affect the establishment of the crime. Thus,

Reasons for sentencing

1. Defendant A

(a) Scope of applicable sentences: One year and six months from June to one year [the scope of applicable sentences, in accordance with Article 42 of the former Criminal Act (amended by Act No. 10259, Apr. 15, 2010; hereinafter the same shall apply], inasmuch as the maximum punishment of imprisonment was changed to a maximum amount of punishment according to the revision of the Criminal Act after the crime was committed, the aggravation of concurrent crimes and discretionary mitigation of punishment];

(b) Scope of recommendations based on the sentencing criteria;

[Determination of Type] Embezzlement and Breach of Trust, Type 3 (not less than KRW 500,00 but less than five billion)

[Special Convicts] Mitigation elements (in cases where punishment is not granted or a significant damage is recovered)

[Scope of Recommendation] Reduction Area ( Imprisonment from June to July, and the method of dealing with dual concurrent crimes)

(c) Determination of sentence: Imprisonment with prison labor for eighteen years and six months;

【General Exemplarys】 Reductions (Seriously half)

(d) Criteria for suspension of execution;

【Main Grounds for Main References】 A negative (not more than five years of suspension of execution, or a fine not less than three times)

(P) If significant damage has been positively recovered)

【Reasons for General Reference】 A negative (a person who has been convicted of the same kind of crime or of two or more suspended sentence)

[If a large volume of victims (shareholders) is caused]

positive (influence) ( considerable deposit, partial recovery of damage, and effort to recover serious damage)

E. The reason for sentencing is that the crime of this case committed by Defendant A pretended to pay the stock price to the victim company for the purpose of pretending to meet the requirements of 10 billion won or more in order to have the victim company designated as the corporation in charge of the operation of the fishery products wholesale market in Busan. However, even though it did not meet the requirements of 10 billion won or more, the crime of this case is very significant. In addition, Defendant A was punished in light of the following facts: (a) in the position of a person in charge of the business affairs of the victim company, in order to receive the amount of 2.75 billion won or more paid to the above company; and (b) in the position of a person in charge of the business affairs of the victim company, documents for listing in the name of a person in charge of the above company, and transfers the above company's funds to the victim company six times in total, thereby gaining property profits equivalent to the same amount; and (c) the amount of damages to the victim company was considerably damaged by the victim company; and (d) the continuous development of international fishery products wholesale market is very likely to be punished.

However, Defendant A’s acknowledgement of the crime of this case reflects his mistake, and the considerable amount of the amount acquired by the crime of this case appears to have been returned to the victim company, and the recovery of damage by establishing a pledge on the shares of the victim company held by Defendant A.

In addition, considering the circumstances favorable to Defendant A such as Defendant A’s age, character and conduct, environment, circumstances of crime, means and consequence, etc., the conditions for sentencing specified in the instant case, such as Defendant A’s age, character and conduct, background and means of crime, circumstance after crime, etc., the sentence shall be determined within the scope of the sentencing guidelines as ordered by the order of Defendant A, by taking into account all the circumstances that form the conditions for sentencing specified in the instant case, including the following factors.

2. In light of the fact that Defendant B’s crime of this case is an act of undermining the essence of the corporation by making a capital a disguised payment, the most paid money reaches KRW 3.4 billion, and that it harms public interest by impairing the credit of the original of notarial deed and impeding the business of designating a corporation to be in charge of the operation of the Busan District Fishery Products Wholesale Market, which is a public business, the public business, etc., the crime committed by Defendant B is heavier than the nature of the crime and the crime.

However, Defendant B did not obtain any particular economic benefit from the instant crime, and did not have any record of committing any crime prior to the instant crime, etc. In addition, taking into account all the circumstances that conditions for sentencing specified in the instant case, such as Defendant B’s age, character and conduct, environment, background, means and consequence of the instant crime, and circumstances after the instant crime, etc., Defendant B shall be sentenced to punishment as ordered within the scope of sentencing guidelines.

Judges Noh Jeong-sik

Judge Lee Young-young

Judges Park Chang-hee