CONTENTS
- 1. The Client Who Came to a Lawyer for the Crime of Fraud After a Criminal Complaint Was Filed
- - The Elements for the Establishment of the Crime of Fraud
- 2. The Lawyer for the Crime of Fraud's Response to Defend Against the Fraud Suspicion
- - Establishing That There Was No Intent to Fraudulently Obtain at the Time of the Transactions
- - Emphasizing the Difference Between Civil Default and Criminal Fraud
- - Submission of Materials on Loss Recovery Efforts and the Normal Relationship
- 3. The Non-Referral Decision by the Investigative Authorities That the Lawyer for the Crime of Fraud Led To
- - If You Are Suspected of Fraud Over Unpaid Goods
- - Frequently Asked Questions and Answers
- - A Fraud Suspicion Case in Comic Form
1. The Client Who Came to a Lawyer for the Crime of Fraud After a Criminal Complaint Was Filed
The client in this case, who came to a lawyer for the crime of fraud, was a business owner who ran a small local food distribution company.
The client continued the business by supplying raw materials received from suppliers to various restaurants and retail businesses.
In the early stages the transactions were maintained stably, but as an economic downturn, rising costs, and delays in payment by major supply destinations overlapped, the client's cash flow rapidly deteriorated.
In the end, payment for goods to some business partners was delayed, and one of the business partners filed a complaint on suspicion of fraud, claiming that the client had received the goods without any intention of paying from the beginning.
The client asserted that the payment had merely been delayed owing to business difficulties, and that there had been no fact of deceiving the business partner to fraudulently obtain goods.
However, once the criminal complaint was filed, the client could be criminally punished for the crime of fraud if the client failed to properly account for the matter during the investigation, so the client requested the assistance of a lawyer for the crime of fraud.
The Elements for the Establishment of the Crime of Fraud
The crime of fraud is not established merely by the circumstance that a person failed to repay money or to perform a contractual obligation.
For the crime of fraud under the Criminal Act to be found, the following elements for its establishment must be satisfied.
Category | Main content |
|---|---|
Deceptive act | Whether there was an act of deceiving the transaction counterpart |
Mistake | Whether the counterpart transacted while believing a false fact |
Disposal act | Whether the counterpart supplied goods or provided a pecuniary benefit |
Occurrence of loss | Whether a pecuniary loss occurred to the business partner |
Intent to fraudulently obtain | Whether there was an intention not to pay from the beginning |
As with this client who came to a lawyer for the crime of fraud, especially in cases of unpaid goods, whether there was no intention or ability to pay from the time of the transaction becomes the key issue.
If the matter is one in which payment was delayed owing to unexpected management difficulties arising after the transaction, it is difficult to immediately conclude that this is the criminal crime of fraud.
Where the amount obtained through the fraudulent offense exceeds a certain size, the Act on Aggravated Punishment of Specific Economic Crimes applies, and much heavier punishment than the crime of fraud under the Criminal Act may be imposed.
Amount fraudulently obtained | Level of punishment |
500 million won or more ~ less than 5 billion won | Imprisonment for a definite term of not less than three years |
5 billion won or more | Life imprisonment or imprisonment for not less than five years |
Even if the crime of fraud is found, the actual sentence is determined by comprehensively considering the following factors.
The planning and repetition of the offense
Whether the loss was recovered
Whether there was a settlement with the victim
Whether it was a first offense
The attitude of admitting and showing remorse for the offense
Whether there are prior convictions for the same type of offense
In particular, where a substantial portion of the loss amount has been repaid or an amicable settlement has been reached with the victim, this may be considered as grounds for non-prosecution, a suspended sentence, or a reduction of sentence.
Therefore, if you come to be suspected of fraud, rather than merely denying or admitting the suspicion, it is important to systematically organize the circumstances of the transaction, the repayment efforts, and the loss recovery situation, and to actively account for them.
2. The Lawyer for the Crime of Fraud's Response to Defend Against the Fraud Suspicion
After conducting an in-depth consultation with the client, the lawyer for the crime of fraud took the following measures in order to prevent criminal punishment.
Establishing That There Was No Intent to Fraudulently Obtain at the Time of the Transactions
The lawyer for the crime of fraud first closely analyzed the client's entire transaction history and cash flow.
In particular, the lawyer organized the case centering on the point that the client had normally paid for goods from the early stage of the transactions and had continued to repay a portion of the amount even after the financial situation deteriorated.
The lawyer also secured materials showing that the client had continuously communicated with the business partners and explained a repayment plan.
Through this, the lawyer actively demonstrated to the investigative authorities that the client had not evaded payment but had made efforts to repay the debt while maintaining the business.
Emphasizing the Difference Between Civil Default and Criminal Fraud
The lawyer for the crime of fraud emphasized that this case was not a fraud case subject to criminal punishment, but was closer to a civil default arising in the course of business operation.
The lawyer confirmed that there were no circumstances indicating that the client had deceived the business partner to receive goods, and that the business partner was also aware to some extent that the client's financial situation was not good.
Accordingly, the lawyer organized and submitted the records of conversations with the business partner, the transaction statements, some repayment records, and the deposit materials.
Submission of Materials on Loss Recovery Efforts and the Normal Relationship
The lawyer for the crime of fraud focused on establishing that the client had made efforts to reduce the debt even amid management difficulties.
The client paid a portion of the amount to the business partner as soon as receivables were collected, and continued attempts to raise operating funds by disposing of business assets or receiving help from family.
The lawyer for the crime of fraud systematically organized these repayment records and fund-raising materials and submitted them to the investigative authorities.
The lawyer also emphasized that the client had faithfully negotiated for loss recovery even after the criminal complaint, and demonstrated that this was a matter more suited to a civil resolution than to criminal punishment.
3. The Non-Referral Decision by the Investigative Authorities That the Lawyer for the Crime of Fraud Led To
After the assistance of the lawyer for the crime of fraud, the investigative authorities that reviewed the matter recognized the fact that the client had received goods from the business partner and the fact that some payment was unpaid.
However, considering the circumstances of how the non-payment arose, the existing transaction relationship, some repayment records, and the client's attitude at the time of the transaction as a whole, they judged that it was difficult to conclude that the client had proceeded with the transaction with an intent to fraudulently obtain the payment from the beginning.
In the end, the investigative authorities found that the evidence to recognize the fraud suspicion was insufficient and issued a non-referral decision for the client.
The client came to escape the risk of criminal punishment, and the remaining debt matter could thereafter be resolved through civil procedures.
If You Are Suspected of Fraud Over Unpaid Goods
A problem of non-payment arising in the course of business is not easy to classify as a default or as the criminal crime of fraud.
In particular, where the complainant asserts that “there was no intention to give the money from the beginning,” the investigative authorities intensively examine the intention and ability at the time of the transaction.
Therefore, if you come to be suspected of fraud, you must quickly organize the situation at the time of the transaction, the repayment records, the conversations with the counterpart, the flow of funds, and the like.
If the initial response is delayed, a matter that could be resolved as a civil dispute may expand into a criminal case, so it is important to accurately analyze the issues of the case with the assistance of a lawyer for the crime of fraud.
Daeryun, the ninth-largest law firm in Korea (based on 2025 value-added tax filings with the National Tax Service), resolves cases under the principle of assigning multiple highly experienced specialized attorneys to a single case.
If you need a legal response owing to a fraud suspicion, we recommend that you have your situation reviewed by an expert through the 🔗criminal legal consultation intake application.
Frequently Asked Questions and Answers
Q. Attorney for the crime of fraud, can a person be punished for the crime of fraud even if the person did not actually receive money?
It is possible. The crime of fraud is subject to punishment not only for the completed offense but also for the attempted offense. Therefore, even where a person tried to deceive the counterpart to acquire a pecuniary benefit but the victim, suspecting this, did not transfer the money, or the offense was discovered in the middle, attempted fraud may be established. However, for the attempted offense, the level of punishment is determined by comprehensively considering whether an actual loss occurred, the danger of the offense, the attitude after the offense, and the like. In particular, where no actual pecuniary loss occurred and it is a first offense, this may be considered as a favorable mitigating factor, so it is advisable to obtain the help of a lawyer for the crime of fraud.
Q. Attorney for the crime of fraud, if a complaint is filed against a person on suspicion of fraud, through what procedure does the case proceed?
When a complaint is filed on suspicion of fraud, the investigative authorities question the complainant and the suspect and secure related materials such as contracts, deposit records, text messages, and call recordings to review the facts. Thereafter, depending on the result of the investigation, if the suspicion is not found, a non-referral or non-prosecution disposition may be issued, and if the suspicion is judged to be found, referral to the prosecution and the indictment procedure proceed. After indictment, guilt or innocence and the sentence are determined through a criminal trial. In fraud cases, the initial statement and the submitted materials often significantly affect the direction of the investigation. Therefore, if you become aware of the fact of a complaint, it is safer to obtain the help of a lawyer for the crime of fraud and promptly organize the circumstances of the transaction, the repayment records, and the like.
A Fraud Suspicion Case in Comic Form
In all criminal cases, including a fraud suspicion, being contacted by the investigative authorities does not immediately mean that guilt is found.
If the circumstances of the case and the evidentiary relationship are closely reviewed and an appropriate response is made from the early stage, it is quite possible to contest the suspicion.
In fact, this firm has assisted a client who was involved in a large-scale fraud case with an amount fraudulently obtained reaching the tens of billions of won and who faced the risk of serious criminal punishment.
You may review how the client came to be acquitted through the 🔗webtoon on a large-scale fraud suspicion acquittal case.
This content is based on actual case studies of Daeryun Law LLC with some adaptations, and the copyright belongs to our firm.
Unauthorized reproduction, duplication, or distribution and other copyright infringements may result in legal action under applicable laws.
