SOUTH KOREA Law and Practice Contributed by: Soo Bong Jung, Jinwook Song, Jinwon Choi and Jiyoung Sohn, Bae, Kim & Lee LLC
white-collar criminal cases, there has been limited reli - ance on criminal courts for monetary recovery. There have been discussions about enacting class actions for cases under fair trade law and other crimes that affect a large number of consumers or citizens. However, Korea currently only permits class actions in the context of certain securities law violations. 2. Enforcement 2.1 White-Collar Enforcement Authorities The governmental agencies authorised to take enforcement action against white-collar offences include: • the National Police Agency (NPA); • the Prosecutors’ Office (PO); • the Korea Fair Trade Commission (KFTC); • the National Tax Service (NTS); • the Korea Customs Services (KCS); • the Financial Supervisory Service (FSS); • the Financial Services Commission (FSC); and • the Securities and Futures Commission (SFC). The NPA and the PO are the main governmental authorities tasked with the investigation, prosecution and enforcement of white-collar offences. In addition, the NTS has a role in investigating tax crimes, and the KCS handles investigations related to customs duty offences. When it comes to financial or securi - ties offences, the FSS, the FSC and the SFC work with the PO. The KFTC, meanwhile, is authorised to inves - tigate cartel activities or other fair trade law violations. While administrative penalties can be imposed by Korean authorities for certain white-collar offences, there is no mechanism for their civil enforcement. Various government authorities have special units dedicated to investigating complex white-collar crimes. For instance, the PO has prosecutors special - ising in the investigation of securities law violations, tax fraud, trade secrets violations and fair trade law violations, including cartel investigations. Similarly, the NPA has established, and currently operates, a num -
ber of special police units dedicated to investigating particular types of white-collar crimes. 2.2 Initiating an Investigation A criminal complaint by a victim or a petition from a third party can set off white-collar investigations. Over recent years, there has been a noticeable rise in whistle-blowing by insiders with specific information. In addition, several civic groups and labour unions have taken an active stance in filing criminal referrals, requesting criminal investigations against politicians and large corporate entities. Specifically concerning cartel investigations, leniency applications to the KFTC by one of the colluding par - ties often serve as the tipping point, prompting the KFTC to initiate a probe. Additionally, the financial authorities, upon their review and analysis of trading records, may also instigate an investigation. 2.3 Powers of Investigation The Korean investigative authorities may employ the following means to commence, continue and/or con -
clude their investigations. Request for Information
The investigative authorities may begin their inquir - ies into white-collar crimes with a formal request for
information. Dawn Raids
Korean investigative authorities – including the PO, the NPA, the KFTC, the KCS and the NTS – often resort to dawn raids to gather evidence. A court-issued warrant is typically required for search and seizure in criminal investigations. The scope of information collected can include physi - cal documents, recorded communications, emails and other electronically stored information (ESI). In addi - tion, the investigative team may seek voluntary sub - mission of specific information. Unlike the US, Korea does not recognise attorney–cli - ent privilege, so communications with outside counsel
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