The warning came after the regulator found that criminal groups were increasingly using gift certificates to move stolen funds instead of transferring the money or withdrawing it from ATMs, making the proceeds harder to trace.
The scheme begins with people who have low credit scores and may struggle to obtain conventional loans. Posing as employees of savings banks or other financial institutions, scammers tell them that repeated gift certificate purchases can build a transaction record and help them qualify for financing.
They then offer to handle the purchases and ask for the applicants’ bankbooks and debit cards, making the request appear to be part of the loan process.
Handing over a bank account or debit card can itself be illegal in the country. Under the Electronic Financial Transactions Act, doing so can carry up to five years in prison or a fine of up to 30 million won ($21,600). Those who provide their banking information knowing it will be used for crime could also face criminal charges, the FSS said.
Once the accounts are secured, the fraudsters target other victims, offering to replace their existing loans with lower-interest ones. One of them then poses as an employee of the victim’s current lender and demands immediate repayment, falsely claiming that the new loan application breaches the existing agreement.
The target is then told to send the repayment to a personal account — one obtained earlier from a low-credit loan applicant, claiming that using the lender’s official account would leave a record of the supposed loan violation.
As soon as the money is transferred, it is used to buy large amounts of gift certificates, which are quickly converted into cash. The cash is then converted into cryptocurrency and ultimately sent to operators overseas, according to the FSS.
The regulator also stressed that legitimate refinancing is handled between financial institutions and does not require customers to send repayments to personal accounts.
“Any claim that buying gift certificates will help you get a loan is a scam,” the FSS said, urging consumers never to hand over their bankbooks or debit cards.
Those who have already done so should immediately contact their financial institution to block the card and suspend transactions, then report the case to police, it added.
In response, the FSS worked with major retailers and gift certificate issuers to cut the purchase limit at unmanned kiosks from 5 million won ($3,600) per transaction to 1 million won per transaction and per day. Larger purchases must now be made in person at store counters.
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