A. Violation of the Act on the Punishment of Arrangement of Commercial Sex Acts, Etc. ( sexual traffic notice)

Ships, etc.)

B. Violation of the Immigration Control Act

Defendant 1 and three others

Prosecutor (Defendants)

Attorney Lee Jong-hoon (for the defendant 1)

Ulsan District Court Decision 2019No1053 Decided December 20, 2019

October 15, 2020

All appeals are dismissed.

The grounds of appeal are examined.

1. Article 8(1) of the Act on the Regulation and Punishment of Criminal Proceeds Concealment (hereinafter referred to as the "Regulation of Criminal Proceeds Concealment") provides that "funds or property related to a crime under Article 19(2)1 of the Act on the Punishment of Arrangement of Commercial Sex Acts, Etc. (hereinafter referred to as the "Act on the Punishment of Commercial Sex Acts, Etc.") (limited to the act of providing funds, land, or buildings despite being aware of the fact that they are provided for commercial sex acts, among acts of arranging commercial sex acts, etc.) shall be one of "criminal proceeds" under Article 2(1)2 of the Act on the Punishment of Criminal Proceeds Concealment (hereinafter referred to as the "Regulation of Criminal Proceeds Concealment"). "Act on the Punishment of Criminal Proceeds Concealment" includes not only acts of offering funds, land, or buildings despite being aware of the fact that they are provided for commercial sex acts, but also acts of offering funds, soliciting, inducing, inducing, or compelling another person to purchase and sell them [Article 2(1)2 (a) or 20 (1)2 (3) of the Act on the Punishment of Commercial Sex Acts, etc.

Meanwhile, in a case where the requirements for confiscation or collection are related to the facts charged against which a public prosecution was instituted without filing a public prosecution under our legal system, confiscation or collection can be conducted pursuant to the proviso of Article 49 of the Criminal Act (see, e.g., Supreme Court Decision 92Do700, Jul. 28, 1992). The same applies to cases where criminal proceeds are confiscated pursuant to Article 8(1) of the Act on Regulation of Criminal Proceeds Concealment.

2. The record reveals the following circumstances.

A. The Defendants, who shared their respective roles, agreed to arrange commercial sex acts and divide profits from all business establishments, were indicted on the charges that: (a) leased several types of rooms from around December 2018 to July 25, 2019, and then arranged commercial sex acts by employing female employees.

B. The first instance court found the Defendants guilty of all the facts charged, and forfeited the lease deposit claim for the refund of the lease deposit with respect to each unit of officetels listed in the attached Forms 2 through 6 of the first instance judgment based on Article 25 of the Commercial Sex Acts and Article 48(1)1 of the Criminal Act, based on Article 25 of the Commercial Sex Acts and Article 48(1)1 of the Criminal Act.

C. The lower court reversed the judgment of the first instance court that sentenced the forfeiture of the claim to return the lease deposit of this case on the following grounds, and did not sentence the forfeiture.

(1) The claim for the refund of the lease deposit of this case is not the "goods provided or intended to be provided for an act of crime" under Article 48 (1) 1 of the Criminal Act, but the "money and valuables, etc. acquired by a person who committed a crime under Articles 18 through 20 under Article 25 of the Commercial Sex Acts Punishment Act" is not the "money and valuables,

(2) The facts charged in the instant case did not state that “a person provided funds, land, or buildings with knowledge of the fact that a person provided a sexual traffic corresponding to the mode of conduct under Article 2(2)2(c) of the Act on the Punishment of Commercial Sex Acts” is not stated in the applicable provisions of Article 8(1) of the Act on the Regulation of Criminal Proceeds Concealment, and therefore, it cannot be forfeited pursuant to Article 8 of the Act on the Regulation of Criminal Proceeds Concealment.

(3) Even if an actor of sexual traffic arranged business by leasing a place to arrange sexual traffic at that place, barring any special circumstance, it is difficult to deem that the actor provided funds, land, or building despite being aware of the fact that he/she is provided for sexual traffic, unless he/she is allowed to lease or provide the land, building, etc. for sexual traffic.

3. The lower court’s determination is difficult to accept for the following reasons.

A. Article 2(1)2(c) of the Punishment of Commercial Sex Acts includes an act of providing funds, land, or a building upon knowing that the act is provided for sexual traffic. In addition, Article 2(1)2(a) or (b) of the Punishment of Commercial Sex Acts also provides not only the act of a commercial sex broker to provide his/her own "land or building" but also the act of providing "funds." Therefore, the act of a broker of commercial sex acts that the defendants, who are agents of commercial sex acts, pay security money to a lessor to rent each room of officetels, which is a place necessary for the business of arranging commercial sex acts, constitutes "the act of providing funds with knowledge of the fact that the defendants are provided for commercial sex acts" under Article 2(1)2(c) of the Commercial Sex Acts.

B. Although the prosecutor prosecuted the Defendants’ act as an act falling under Article 2(1)2(a) of the Act on the Punishment of Commercial Sex Acts, as long as the Defendants’ act is acknowledged as an act under Article 2(1)2(c) of the Punishment of Commercial Sex Acts, this part of the facts charged is subject to confiscation under the Regulation of the Punishment of Commercial Sex Acts.

Since it is recognized as related to the act of sexual traffic under Article 2 (1) 2 (c) of the Act on the Punishment, etc. of Commercial Sex Acts, the right to return the lease deposit of this case does not violate the principle of no accusation even if the right to return the lease deposit of this case is confiscated. Therefore, the right to return the lease deposit of this case can be forfeited as criminal proceeds pursuant to Article 8 (1) 1 of the Act on the Regulation, etc. of Criminal Proceeds Concealment as "funds or property related to the act of providing funds with knowledge of the fact that the lease deposit of this case is provided as criminal proceeds."

D. The court below erred in holding that the claim to return the lease deposit of this case is not subject to confiscation as stipulated in the Regulation of Criminal Proceeds Concealment Act on the ground that the Defendants’ act does not fall under “the act of providing funds” with knowledge of the fact that the Defendants’ act was provided for sexual traffic and this part of the facts charged is not related to “the act of offering funds with knowledge of the fact that the act was provided for

4. However, since confiscation under Article 8(1) of the Act on the Regulation of Criminal Proceeds Concealment is discretionary, it is left to the court’s discretion whether to confiscate even an article that meets the requirements for confiscation (see Supreme Court Decision 2000Do515, Sept. 4, 2002). Since the court below’s failure to confiscate the claim for return of the lease deposit of this case can be deemed to have exercised discretionary power by taking into account various circumstances, deeming that the claim for return of the lease deposit of this case is subject to voluntary confiscation, it does not affect the conclusion of the judgment by the court below. Accordingly, the ground of appeal is without merit.

5. Therefore, all appeals are dismissed. It is so decided as per Disposition by the assent of all participating Justices on the bench.

Supreme Court Decision 201

Justices Kim Jae-in

Justices Min Il-young in charge

Justices Lee Jae-hwan