BUSAN (The Korea Herald/ANN): An illegal loan ring operated by a Korean father-son duo, which lent a total of 16.2 billion won (US$11million) to more than 9,000 foreign workers at interest rates as high as 154 per cent a year, has been busted, Busan police said on Nov 24.
The Busan Metropolitan Police Agency said it has referred six members of the ring to the prosecution – three with detention and three without – for violating the Registration of Credit Business and Protection of Finance Users Act.
The mastermind is a 60-year-old Korean national residing in Thailand, who allegedly used his son to run the operation in Korea. Police have requested that the International Criminal Police Organization issue a Red Notice for his arrest. The son is among those already nabbed.
According to authorities, the father-son duo generated approximately 5.5 billion won in profits from illegal loans since February 2022. They targeted 9,120 financially vulnerable migrant workers, unfamiliar with Korea’s banking system, borrowing between 1 million won and 5 million won each. Most victims were men between their 20s and 50s from South-east Asia.
The father, who fled to Thailand in 2020 to avoid prosecution for previous similar offences, posed as the operator of a fake language academy and used social media to recruit brokers who then connected loan seekers with the organization. His 30-year-old son handled contracts and payment collection within Korea.
When borrowers missed repayment deadlines, the ring sent notices claiming to have seized the victims’ assets, warning that their wages and pensions were at risk, and threatening to report the workers to Korea’s Immigration Office.
Police said the group also committed large-scale fraud by fabricating instalment purchase agreements – disguising the loans as sales contracts – and filing over 1,500 court claims worth more than 5 billion won.
The investigation began in April after authorities received intelligence about illegal loans targeting migrant workers. Police conducted search-and-seizure operations to trace repayment records and identify thousands of victims, securing sufficient evidence to charge the suspects.
Authorities have already moved to freeze approximately 2.1 billion won in criminal proceeds and notified tax authorities to collect taxes on the illegal income.
Police said they will continue efforts to track down and apprehend the ringleader, who remains abroad. -- THE KOREA HERALD/ASIA NEWS NETWORK
