A loan shark who charged interest rates significantly above the legal limit and collected millions in interest has received a suspended prison sentence in an appeals court.
The Jeonju District Court's Criminal Division 3-3, led by Judge Jeong Se-jin, announced on October 27 that it dismissed the prosecutor's appeal in the case against a 67-year-old man, referred to as A, who was charged with violating the Registration of Credit Business Act and the Protection of Financial Users Act. The original sentence of eight months in prison, suspended for two years, along with 80 hours of community service, was upheld.
A was accused of lending approximately 1 billion won (about $750,000) to 111 borrowers from 2018 to 2024, collecting 320 million won (about $240,000) in interest alone.
The interest rate he applied was a staggering 182% annually, which is nine times the legal maximum of 20% per year.
Under current laws regarding the registration of credit businesses and the protection of financial users, the legal maximum interest rate is set at 20% per year. Operating a lending business without proper registration can result in a prison sentence of up to 10 years or a fine of up to 50 million won, while charging interest rates above the legal limit can lead to a maximum of five years in prison or a fine of up to 20 million won.
A was found to have profited significantly over an extended period by targeting financially vulnerable victims without even registering as a legitimate lender.
The appeals court stated, "The original court considered various circumstances, including the fact that the defendant reached settlements with some victims after the incident, when determining the sentence." It concluded that the original sentence did not exceed reasonable discretion, thus rejecting the prosecutor's appeal.
* This article has been translated by AI.
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