Drama 'Penthouse' PPL Inserted, Advertising Fees Pocketed

[Financial News] An advertising agency representative who pocketed tens of millions of won by promising to insert advertisements into a popular TV drama has been found guilty in court.
According to the legal community on the 10th, the Seoul Western District Court Criminal Division 7 (Judge Ma Seong-yeong) sentenced advertising agency representative Mr. A (48) to 10 months in prison for fraud charges.
Mr. A was brought to trial on charges of signing a contract to insert product placement (PPL) in the drama 'Penthouse 2·3' and receiving an interim payment of 96.8 million won.
According to the judgment, Mr. A signed a production support contract with the diet company Juvis under the name of the corporation he operated in December 2020. The contract included inserting 24 subtitle ads, 8 product placements, and 2 episode ads in the drama 'Penthouse 2·3', with a total contract amount of 264 million won. Juvis paid an advance of 88 million won in January 2021 according to the contract.
However, it was found that the drama script was already significantly written, making it uncertain to insert new product placements. Mr. A received notifications from the drama marketing agency on January 4 and 6, 2021, that ad insertion was impossible. Nevertheless, without disclosing this fact, he additionally received the first interim payment of 96.8 million won on the 29th of the same month.
The court recognized the amount received after this point as a breach of the duty to notify, constituting fraud. However, it did not recognize fraudulent intent for the advance payment, as it could not be concluded that ad insertion was completely impossible at the time of payment. During the execution of subtitle ads, some amounts were returned to the victim, and the final damage amount was calculated as 68.64 million won, reflecting the return of VAT.
The court stated, "The defendant had a duty to notify the victim company of the impossibility of ad insertion based on the principle of good faith, but he did not," and "By concealing this fact, he deceived the victim company, constituting fraud."
Regarding the sentencing reasons, "The defendant's denial of the crime and lack of remorse, and the substantial amount of damage are unfavorable, but the fact that he is a first-time offender and the actual damage amount is 68.64 million won are favorable," it stated. "Considering various sentencing conditions, a 10-month prison sentence is imposed, but he is not detained in court," it added.
425_sama@fnnews.com Choi Seung-han Reporter