SOUTH KOREA Law and Practice Contributed by: Byung Chang Lee, D&A LLC
1.3 Claims Against Parties Who Assist or Facilitate Fraudulent Acts The Illegality of Assistance or Facilitation of Fraudulent Acts From a criminal law perspective, the acts of assist - ing or facilitating the fraudulent acts of another can constitute criminal violations such as conspiracy or aiding/abetting of another’s criminal acts, depending on the degree of assistance or facilitation. There is not yet a clear line dividing conspiracy and aiding/abetting depending on specific situations; however, any kind of assistance or facilitation of another’s fraudulent acts can be punished under the criminal law. Additionally, fraudulently obtained assets can be seized by criminal investigative authorities and con - fiscated, depending upon the court’s decision. In the context of the offence of acquiring stolen property, “acquisition” refers to obtaining control and the ability to dispose of the stolen property, effectively by taking possession of it. The Korean Supreme Court held that “in order to impose liability for damages on the account holder who transferred the access medium for aiding and abetting through negligence, a causal relationship should be recognised based on the specific circum - stances at the time of the transfer, by ensuring that the account holder could have foreseen that the individual transaction conducted through the access medium constitutes a tortious act and that using the access medium facilitates such tortious act” (Supreme Court Decision 2012Da84707). Bank Account Transfer and Withdrawal Cases The Korean Supreme Court held that “as the fraudu - lent act of the main criminal is terminated when the defendant receives money from the victim without transferring it to the principal offender, even if the accused later withdraws the money from the sav - ings account, it is only the result of requesting the bank to return the deposit as the holder of account, and therefore the accused act of withdrawal cannot be punished as a separate crime of acquiring stolen property” (Supreme Court Decision 2010Do6256). It can be concluded that, in order to be a separate crime differentiated from the main crime, there should be another violation in terms of acquiring stolen property.
can cover broad areas beyond the typical coverage of bribery. Special Regulations on Employees of Financial Institutions If an employee of a financial institution accepts, demands or promises to receive money, valuables or other benefits in connection with their duties, or if they provide such to a third party, they can be punished pursuant to the Act on the Aggravated Punishment of Specific Economic Crimes, etc. An example of where this provision applies is when a bank employee receives money in exchange for a convenience dur - ing the bank loan process. The law requires financial institutions to have integrity of an equivalent standard to public officials. However, there has been some controversy over whether it is correct to regard the duties of employees of financial institutions as the same as those of public officials, and whether it is reasonable to treat employ - ees of financial institutions differently from employees of other private companies. Other Causes of Action From a civil law perspective, bribery may constitute a tort and give rise to liability against the individual who provides or receives the bribe, whether directly or through an intermediary acting as their agent. From an administrative law standpoint, the giving and receiv - ing of bribes may also amount to a breach of public procurement legislation, potentially leading to sanc - tions such as exclusion from participation in future government tendering processes. Under the relevant government procurement framework, a person who has engaged in fraudulent conduct may be disquali - fied from bidding for a period of up to two years, or, in lieu of such exclusion, a penalty surcharge may be imposed. In recent years, there has also been a growing number of cases in which entities have been sanctioned by multilateral development banks for fraudulent conduct in procurement processes. This development is a par - ticular concern for Korean companies, as the sanction regimes of such institutions are notably stringent both in terms of the duration of exclusion and the limited scope for obtaining relief.
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