The Supreme Court ruled that acts of borrowing tens of millions of won through credit card companies' mobile applications to repay debts cannot be punished as fraud. Fraud requires an act of deceiving a person, and since there is no deceived person in non-face-to-face loans, the crime does not constitute.
According to the legal community on the 21st, the Supreme Court's second division (Chief Justice Kwon Young-jun) overturned the lower court's ruling, which sentenced A (64) to 8 months in prison with a 2-year probation for fraud charges, and sent the case back to the Seoul Southern District Court.
According to the prosecution, A obtained a loan of 18.5 million won through the Hyundai Card app installed on his mobile phone on June 3, 2022. He also received loans from another company, totaling 34.5 million won. However, A was found to have no ability to repay this money and had borrowed the card loans for the purpose of rolling over other debts. As a result, he was indicted on fraud charges.
The first trial recognized A's fraud charges for deceiving the company into misappropriating the loan amount and sentenced him to a suspended prison term. A appealed, but the second trial court dismissed the appeal.
However, the Supreme Court stated that 'it cannot be said that A deceived someone in the process of obtaining the loan' and returned the case for retrial. The Supreme Court had previously ruled that for fraud to be established under the Criminal Act, there must be an act that causes a person to be mistaken.
A entered asset information into the app before receiving the loan, and there was no involvement from any staff. It is stated that there was no deceived person, so A cannot be punished for fraud.