Financial Crime World

South Korea’s DR & AJU LLC: Leading the Fight against Financial Fraud

An In-depth Look at Criminal and Civil Claims

Last Updated: April 22, 2024

In the intricate business environment of South Korea, financial fraud has emerged as a pressing concern. DR & AJU LLC, one of the country’s top ten law firms, provides bespoke legal solutions to tackle fraud, asset tracing, and recovery. With a team of over 250 lawyers and 130 experts, DR & AJU demonstrates agility and responsiveness to address the evolving legal landscape.

Understanding Fraud Claims in South Korea

General Characteristics of Fraud Claims

  • Fraud in South Korea can be classified as both criminal and civil matters due to its broad nature.
  • From a criminal law perspective, fraud involves deceit with the intention to unlawfully acquire property.
    • Maximum penalty: Imprisonment for up to ten years or a fine of up to KRW20 million.
  • Four key elements: Specific intent, deception, an act of disposition, and causation.
  • Fraudulent acts can include excessive product advertisement and corrupt payments to public officials.

Causes of Action after Receipt of a Bribe

  • Bribery is a violation of both the Criminal Act and the Kim Young-Ran Act.
  • Gifts to public officials or similar positions exceeding specific amounts are illegal.
  • Receiving a bribe is a civil law tort claim against the person who provided or received the bribe.
  • In government procurement, violations can result in sanctions, including future bidding prohibitions.

Assisting or Facilitating Fraudulent Acts

  • Assisting or facilitating fraudulent acts can constitute criminal violations such as conspiracy or aiding/abetting.
  • Seized assets can be returned to the victim, and fraudsters may face charges for acquiring stolen property.
  • In mortgage-secured real estate transactions, the creditor can only request the return of the remaining amount after deducting mortgage claims.

Limitations on Filing Claims

  • Tort claims have a limitation period of three years from the damage date or ten years from the illegal act occurrence.
  • Criminal cases have varying limitation periods depending on the maximum sentence for each violation.
  • Filing a criminal complaint first is crucial to ensure timely civil claim filing.

Procedures and Trials

Disclosure of Defendants’ Assets

  • Creditors can request asset disclosure from defendants with enforceable decisions.
  • The court can order defendants to attend hearings and disclose assets.
  • Failure to comply may result in detention or asset searches.

Preserving Evidence

  • To preserve evidence, applicants can request an evidence preservation order from the court.

Obtaining Information from Third Parties

  • Applicants can file applications for document production or request information from third parties.

Procedural Orders

  • Ex parte hearings for provisional measures, such as preliminary attachment orders, are possible.

Criminal Redress and Judgment Without Trial

  • Victims of fraud can seek redress through criminal mediation procedures.
  • Default judgments and payment orders for expedited enforcement.

Rules for Pleading Fraud

  • No special rules or procedures for pleading fraud in South Korea.

Claims against “Unknown” Fraudsters

  • Filing a criminal claim against unknown offenders is possible.

Compelling Witnesses to Give Evidence

  • The court can compel witnesses to attend examination hearings and face fines or detention for non-compliance.

DR & AJU LLC, with its extensive expertise in financial fraud, is at the forefront of combating fraudulent activities in South Korea. Their innovative approach to legal challenges ensures the best possible outcomes for clients while maintaining the highest ethical standards.