Defendant 1 and one other

Kim Jong-Hun

Law Firm Snme et al.

Defendant 1 (Defendant 2) is punished by imprisonment with prison labor for three years and by imprisonment for one year and six months, respectively.

○ Criminal Power of the Defendants

Defendant 1 was sentenced to two years of imprisonment due to the violation of the Act on the Aggravated Punishment, etc. of Specific Economic Crimes (Misappropriation) in the Jeju District Court on July 24, 2008, and the above judgment became final and conclusive on November 26, 2009, and on September 30, 2010, the Busan High Court sentenced two years of imprisonment due to the violation of the Act on the Aggravated Punishment, etc. of Specific Economic Crimes (Misappropriation) and became final and conclusive on February 24, 2011.

Defendant 2 was sentenced to the suspended sentence of three years on July 24, 2008 due to the violation of the Act on the Aggravated Punishment, etc. of Specific Economic Crimes (Misappropriation) in the Jeju District Court on July 24, 2008, and the above judgment was finalized on November 26, 2009, and on September 30, 2010, the Busan High Court sentenced one year and six months to imprisonment for the violation of the Act on the Aggravated Punishment, etc. of Specific Economic Crimes (Misappropriation of Trust) in the Busan High Court on September 30, 201, and finally

○ Status and Duties of the Defendants

1. Status of the Defendants and Nonindicted 127

Defendant 1 is a person who has worked as a vice-chairperson from around April 18, 2003 to February 5, 2004 as the regular director of the non-indicted 2 savings bank (hereinafter “non-indicted 2 savings bank”), from February 6, 2004 to September 21, 2006 as the representative director (from August 26, 2005 to February 25, 2006), and from around September 22, 2006 to August 11, 2009.

Defendant 2 is the chief executive officer and the risk management officer of the non-indicted 2 savings bank from August 1, 2003 to August 25, 2005; from August 26, 2005 to September 21, 2006, Defendant 2 is the director (the representative director's duties on behalf of the representative director from August 26, 2005 to February 25, 2006); and from September 22, 2006 to September 4, 2008, he is the representative director.

공소외 127은 유흥주점 및 요식업을 운영하던 사람으로 공소외 207(모친), 공소외 208(처), 공소외 209(동생), 공소외 210( 공소외 209의 처), 공소외 211(처제), 공소외 212, 213(각 공소외 127 운영의 ▷▷ 유흥주점의 직원) 등 친인척 및 지인 그리고 공소외 214 주식회사(대표이사 공소외 127), 공소외 215 주식회사(위 공소외 214 주식회사에 무역업을 추가하여 상호만 변경한 회사로 대표이사는 공소외 222이나, 실질적인 대표이사는 공소외 127임) 명의를 빌려 공소외 2 저축은행에서 대출을 받은 사람이다.

2. Defendants’ duties

Defendants have the following occupational duties:

Since an executive officer in charge of credit business of a mutual savings bank determines to maintain soundness and profitability of loans through thorough evaluation and analysis of credit risks, such as the debtor's risk characteristics, financial standing and credit standing, future debt repayment ability, etc. in accordance with the loan regulations, (2) it is possible to deal with loans within an appropriate level through comprehensive examination and analysis of the debtor's loan purpose, required amount, financing requirement period, actual borrower's loan, etc. (3) it is possible for the debtor to secure collateral value, acquired collateral items and collateral items investigation, and obtain bonds, if the debtor is a corporation or individual business operator, whether the debtor is equipped with human and material facilities such as ordinary workers and capital, and is not a corporation or business with business registration certificate, and thus, it is necessary to thoroughly examine whether the debtor's business operator is able to obtain loan due to an increase in the interest rate of the loan from the public sale of land or real estate collateral, and thus, it is possible for the business operator to obtain loan from the public sale of land at the same time with the possibility of decrease in the revenue from the public sale of loan.

○ Criminal facts

1. 공소외 127은 2005. 3. 내지 4.경 제주시 (이하 생략) 등 3필지 3006.6㎡(예전 ♤♤♤♤♤ 부지 등)을 매수한 후 그곳에 호텔을 신축할 생각으로 토지매입대금을 마련하기 위하여 공소외 2 저축은행에 PF대출(브리지)을 신청하기로 마음먹었다.

At that time, Nonindicted 127 was unable to repay 1.618 billion won, which was loaned by Nonindicted 208 and employees Nonindicted 212 to Nonindicted 2 Savings Bank, at the same time. The Defendants also known to other banks that the liabilities in the name of the principal and the wife amount to KRW 193 million and that it is impossible to recover the subsequent loans if the additional loans were to be handled. However, Nonindicted 127 decided to handle the loans at the request of Nonindicted 127 and requested Nonindicted 127 to apply for the loans.

Accordingly, around May 17, 2005, Nonindicted 127 filed an application for a loan in the name of Nonindicted 211 (the wife of Nonindicted 127), the representative of Nonindicted 216 Company (the business established for real estate development, etc. around March 29, 2005) and Nonindicted 210 (the wife of Nonindicted 209), the representative of Nonindicted 217 Company (the business established for the purpose of real estate sale around May 9, 2005) and Nonindicted 218 Company (the business established for the purpose of real estate sale around May 1, 2005), respectively, for the purpose of the land purchase fund of the borrower.

The Defendants: (a) the actual user of the loan was Nonindicted 127; (b) the aforementioned Nonindicted Company 216, etc. was merely an enterprise with a formal business registration certificate in order to obtain the loan; (c) was well aware that it was not an enterprise having regular workers and human and physical facilities, including capital, or having been actually engaged in the business; and (d) the PF loan should be approved after receiving a normal business plan and closely examining the feasibility of the loan; but (e) Nonindicted Company 216, Nonindicted Company 217, Nonindicted Company 218, and Nonindicted Company 209, Nonindicted Company 210, and 211, and Nonindicted Company 209, Nonindicted Company 210, and 211; and (e) did not completely examine the financial status, repayment ability, credit investigation, etc. of the loan, and business feasibility, etc., in violation of their duties, the Defendants provided the above Nonindicted 127 with a total of KRW 90 million in the name of Nonindicted 209, Nonindicted 210, and KRW

On July 8, 2005, Nonindicted 127 continued to apply for additional loans to Nonindicted 2 Savings Bank in the name of Nonindicted 209, 210, and 211, respectively, for the purpose of land purchase funds. On July 11, 2005, the Defendants violated their duties and provided loans to Nonindicted 127 in the name of the said Nonindicted 209, KRW 2.8 billion in the name of the said Nonindicted 209, KRW 70 billion in the name of Nonindicted 210, and KRW 1.2 billion in the name of Nonindicted 211.

As a result, the Defendants conspired to make Nonindicted 127, the actual borrower, acquire a total of 5.6 billion won property profit and caused property damage equivalent to the same amount to Nonindicted 2 Savings Bank.

2. Around September 28, 2005, Nonindicted 127: (a) discussed with the Defendants in order to reduce the loan interest and principal burden on KRW 5.6 billion borrowed in the name of Nonindicted 209, 210, and 211; (b) set up a collateral security, etc. on the first priority basis of three parcels of land, including the said Jeju Bank (hereinafter omitted); (c) instead, on the one hand, the first priority of the first priority mortgage, etc. established in a savings bank in the name of Nonindicted 2 Savings Bank; (d) on the other hand, on the condition that Nonindicted 2 Savings Bank loans were repaid in the name of Nonindicted 209, KRW 1.6 billion in the name of Nonindicted 210, KRW 340 million in the name of Nonindicted 211, KRW 300,000,000 in the name of the said bank; and (e) from around 2014, KRW 2006 in the name of the said bank; and (e) from around 2016.4.9.

Although the Defendants repaid the loans of Nonindicted 2 Savings Bank equivalent to the same amount as the loans of the similar branch of the Korea Bank identical to the above amount deposited around that time, Defendant 1 violated his duties and thus, Defendant 1 used the loans of the similar branch of the above Korea Bank to be used for the purpose of repaying his personal debt after borrowing the loans, etc., Defendant 2, who is aware of such fact, shall convene a management committee, and prepare a written change in credit conditions, etc., and formally handle as if part of the loans of Nonindicted 2 Savings Bank in the amount of KRW 1,464,218,60 from Nonindicted 2 Savings Bank in the name of Nonindicted 2, 211, were repaid in electronic form.

Accordingly, the Defendants conspired to have Nonindicted 127, the actual borrower, gain a total of KRW 1,464,218,600 property gains, and caused property damage equivalent to the same amount to Nonindicted 2 Savings Bank.

3. Around October 2005, Defendant 1 applied for a loan to Nonindicted 2 Savings Bank in the name of Nonindicted 214 in the name of Nonindicted 214 (Representative Director Nonindicted 127) through Defendant 2 for a loan to Nonindicted 127 in the name of Nonindicted 214 (Representative 127) and for the payment of the interest on the bank loans of Nonindicted 223 (Supreme Court and the appellate court judgment), who is a major shareholder of Nonindicted 2 Savings Bank, who is the major shareholder of Nonindicted 2 Savings Bank. Nonindicted 127 applied for a loan to Nonindicted 2 Savings Bank in the name of Nonindicted 214 as the borrower’s demand on October 24, 2005.

On October 31, 2005, Defendant 1 and Defendant 2, upon receipt of instructions from the said Nonindicted Co. 214, despite the knowledge of the fact that the real estate-related business that was in progress was no longer suspended by business activities and that if the loan was made due to the lack of assets or sales, damage would occur to Nonindicted Co. 2’s savings bank, Defendant 2 did not completely examine the financial status, repayment ability, credit investigation, etc. of Nonindicted Co. 214 and Nonindicted Co. 127 in violation of his duties, and provided the above Nonindicted Co. 127 with a loan of KRW 2 billion in the name of said Nonindicted Co. 214 without being provided with physical security.

As a result, the Defendants conspired to have Nonindicted 127, the actual borrower, gain pecuniary advantage equivalent to KRW 2 billion, and caused property damage equivalent to the same amount to Nonindicted 2 Savings Bank.

4. On April 207, Nonindicted 127 decided to grant a loan to Nonindicted 2 Savings Bank in the name of the said company and to grant a loan to the Defendants, in order to raise the operating funds for Nonindicted 215 Stock Companies established for the purpose of importing and selling fish felling fish required for a fish farm in Jeju-do. Nonindicted 127 decided to grant a loan at the request of Nonindicted 127.

Accordingly, around May 18, 2007, Nonindicted 127 applied for a loan to the borrower for the purpose of operating funds to the effect that Nonindicted 2 Savings Bank was under construction of freezing warehouses in the name of Nonindicted 215 Co., Ltd. in the name of Nonindicted 215.

Although the Defendants knew that Nonindicted 127 had a considerable amount of liabilities that were not repaid to Nonindicted 2 Savings Bank, and Nonindicted 215 Co. 215 had a bad financial structure of Nonindicted Co. 214, which added trade business to Nonindicted Co. 214, which was already suspended business activities on May 2007, and changed its trade business, and that if the loans were to be extended due to the lack of assets or sales, damage to Nonindicted 2 Savings Bank would occur, the Defendants did not fully review the financial status, repayment ability, credit survey, etc. of Nonindicted 215 Co. 27 and Nonindicted 127, and did not receive physical security. The Defendants did not check whether the site to newly construct a freezing warehouse was actually leased in the above Nonindicted Co. 215, and whether the freezing warehouse was being newly constructed, the Defendants loaned KRW 127,50 million to Nonindicted Co. 215 in the name of said Nonindicted Co. 215 without checking.

As a result, the Defendants conspired to make Nonindicted 127, the actual borrower, acquire property benefits equivalent to 1.5 billion won, and caused property damages equivalent to the same amount to Nonindicted 2 Savings Bank.

5. 공소외 127은 2008. 3.경 자신과 관련된 공소외 2 저축은행의 기존 대출금 이자를 납부하고 자신이 운영하는 ‘ ▷▷’ 유흥주점의 운영자금을 마련하기 위해 어머니 공소외 207의 명의를 빌려 공소외 2 저축은행에 대출을 신청하기로 마음먹고, 피고인들에게 대출을 해 줄 것을 요청하고, 피고인들은 공소외 127의 요청대로 대출을 해 주기로 결정하였다.

Accordingly, around March 31, 2008, Nonindicted 127 applied for a loan in the name of Nonindicted 207 under the pretext of using it as the borrower’s household funds to Nonindicted 2 Savings Bank. The Defendants did not fully review the financial status of Nonindicted 127 and Nonindicted 207’s loans, financial ability to repay loans, credit investigation, etc. to Nonindicted 207 on or around March 30, 2007, but did not repay the amount equivalent to KRW 118 million to Nonindicted 2 Savings Bank. Other liabilities not repaid to Nonindicted 2 Savings Bank were considerably high, and Nonindicted 207, a nominal borrower, also did not have the ability to repay debts, making additional loans under the name of the household funds, and even if it was known that the loans will increase the risk of insolvency of the bank and will be used for any purpose other than the household funds of Nonindicted 207, in violation of his duties, and did not receive physical loans under the name of Nonindicted 127 and 207 billion won.

As a result, the Defendants conspired to have Nonindicted 127, the actual borrower, gain pecuniary advantage equivalent to KRW 370 million and suffered pecuniary loss equivalent to the same amount with Nonindicted 2 Savings Bank.

1. Defendant 1’s legal statement and part of Defendant 2’s legal statement

1. Each of the statements made by the prosecution against Defendant 1 and 2 (including each of the statements made by Nonindicted 219, 127, and 220)

1. Some statements in the interrogation protocol of Nonindicted Party 127, Nos. 1, 2, and 6 prosecutor's office are written.

1. The prosecutor’s statement concerning Nonindicted 221

1. Each investigation report (Attachment to loan regulations, etc. of a mutual savings bank);

1. Previous convictions in judgment: Each investigation report (Attachment to the judgment concerned with Defendant 2 and 1) and each criminal history record report (defendant 2 and 1);

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

Each Act on the Aggravated Punishment, etc. of Specific Economic Crimes (Article 3(1)1 of the Act on the Aggravated Punishment, etc. of Specific Economic Crimes, Articles 356, 355(2), and 30 of the Criminal Act [the crime of occupational breach of trust of at least five billion won in the amount of damage, the choice of limited imprisonment, and the maximum amount of punishment shall be 15 years in accordance with the main sentence of Article 42 of the former Criminal Act (amended by Act No. 10259 of Apr. 15, 2010; hereinafter the same shall apply], each of the specific Economic Crimes Act, Article 3(1)2 of the Act on the Aggravated Punishment, etc. of Specific Economic Crimes, Articles 356, 355(2), and 30 of the Criminal Act [the maximum amount of damage shall be 15 years in accordance with the main sentence of Article 42 of the former Criminal Act], and Articles 356, 35(2), and 30 of the Criminal Act

1. Handling concurrent crimes;

The latter part of Article 37 and the first part of Article 39 (1) of each Criminal Code [trade between the above crimes and the violation of the Act on the Aggravated Punishment, etc. of Specific Economic Crimes (Misappropriation)]

1. Mitigation following the handling of concurrent crimes;

The latter part of Article 39(1) and Article 55(1)3 of the Criminal Act

1. Aggravation for concurrent crimes;

Article 37 (former part of Article 37, Article 38 (1) 2, and Article 50 of each Criminal Code [Aggravation of concurrent crimes with the punishment prescribed in Article 1 of the Act on the Aggravated Punishment, etc. of Specific Economic Crimes (Misappropriation of Trust)]

1. Discretionary mitigation;

Defendant 2: Article 53 of the Criminal Act and Article 55(1)3 of the Criminal Act (The following consideration is given to the favorable circumstances among the reasons for sentencing)

1. Summary of the assertion

Defendant 2 and his defense counsel asserted that Defendant 2 was merely a working person in charge of the loan of Nonindicted Bank 2 at the time of the execution of the loan stated in paragraph (1) of the criminal facts as stated in the judgment of Defendant 2, and that Defendant 1 did not agree with Defendant 1 and did not have any awareness of the possibility of the occurrence of damages.

2. Determination

In relation to the loans stated in paragraph (1) of the criminal facts stated in the judgment, Defendant 2 stated in the prosecutor's office that "the 127 was trying to purchase the YY under the direction of Defendant 1, and Nonindicted 127 was known that Nonindicted 216, Nonindicted 217, and Nonindicted 218 was established to have applied for the loans in the name of each of the above companies and applied for the loans in the name of each of the above companies." Defendant 2 ordered Defendant 2 to handle the loans without submitting the business plan, etc. although he was in charge of the important duties of the head of the business who takes charge of the loan and the receipt of the loan, and the head of the risk management department, and Defendant 2 did not raise an objection to Defendant 1 while carrying out the abnormal loan, and Defendant 2's statement conforms to the facts of the prosecution. In light of the above, Defendant 2's act is sufficient to recognize that Defendant 1's act was in breach of trust, and thus, Defendant 2 did not obtain at least property benefits from Defendant 21 and the Bank.

Although the sentencing guidelines are set for each of the crimes against the Defendants, the sentencing standards are not applied in relation to the violation of the Act on the Aggravated Punishment, etc. of Specific Economic Crimes (Misappropriation of Trust) and the latter concurrent crimes of Article 37 of the Criminal Act.

1. Defendant 1

In light of the fact that the amount of damage caused by the Defendant’s crime of this case exceeds 10 billion won, the Defendant used part of the amount of damage caused by this case for personal use, and that Nonindicted Bank 2’s savings bank was subject to bankruptcy due to the crime of this case, etc., even though the Defendant’s crime of this case is in a relation of latter concurrent crimes of Article 37 of the Criminal Act with the violation of the Act on the Aggravated Punishment, etc. of Specific Economic Crimes (Misappropriation of Trust) in which judgment became final and conclusive, the sentence of punishment

2. Defendant 2

In light of the fact that the amount of damage caused by the Defendant’s crime of this case exceeds 10 billion won and that Nonindicted Bank 2’s savings bank caused bankruptcy and caused many victims, it is inevitable to sentence the Defendant’s imprisonment.

However, in consideration of the fact that the defendant is the so-called president employed by the savings bank of non-indicted 2, who committed the crime of this case according to the direction of defendant 1, etc., there is no ground for personal pecuniary profit through the crime of this case, the defendant's violation of the Act on the Aggravated Punishment, etc. of Specific Economic Crimes (Misappropriation of Trust) in which the judgment of this case became final, and the latter concurrent crimes under the latter part of Article 37 of the Criminal Act,

Judges Song-sung Human Rights (Presiding Judge)