[Exclusive] Special Judicial Police for Public Welfare Finance Confirms Investigation into Illegal Debt Collection... 'Targeting' Imprisonment Funds

With the decision to include violations of the Debt Collection Act in the investigative scope of the Special Judicial Police for Public Welfare Financial Crimes (Special Police), set to launch next year, initial investigations and response capabilities against illegal collection practices, such as intimidation and assault, are expected to be strengthened. According to the financial sector on the 26th, the Financial Services Commission, the Financial Supervisory Service, and the Ministry of Justice recently agreed to include the Debt Collection Act, in addition to the Lending Business Act, as part of the Special Police's investigative scope. Currently, the Financial Supervisory Service operates a Special Police unit targeting unfair trading in the capital market, such as stock market manipulation.
However, concerns have been raised that there are limitations in initial response to public welfare financial crimes, such as illegal private lending and voice phishing, due to the lack of direct investigative authority. Accordingly, efforts to introduce a special judicial police force for public welfare have been underway since last December. The biggest hurdle in the introduction process was identified as the scope of investigation.
The financial authorities and the Ministry of Justice agreed to include violations of the Lending Business Act, such as collecting interest exceeding the legal maximum rate and unregistered lending businesses, as subjects of investigation. However, opinions were divided regarding the Debt Collection Act, which regulates illegal debt collection practices such as assault, intimidation, and repetitive contact.
Financial authorities argued for the inclusion of the Act, as illegal collection involving excessive pressure is cited as the greatest harm caused by illegal private lending; in contrast, the Ministry of Justice has maintained a negative stance, citing concerns that the Financial Supervisory Service's investigative authority could be excessively expanded and citing issues with investigative capacity. With the decision to have the Special Judicial Police for Public Welfare investigate matters under the Debt Collection Act following demands from financial authorities, the effectiveness of the Special Judicial Police is expected to be significantly enhanced.
The financial sector believes that since the damage caused by illegal private lending is spreading beyond simple high-interest charges to illegal collection practices such as intimidation and invasion of privacy, expanding the scope of investigation to include the debt repayment process as well as the loan itself would be more effective in protecting victims. 0%).
Now that the scope of the investigation has been clarified, financial authorities plan to further accelerate the launch of the Special Judicial Police. To establish the Special Judicial Police, the Judicial Police Duties Act must be amended to provide the relevant legal basis.
The authorities plan to expedite the amendment by proposing the relevant government bill in the form of a legislator-initiated bill. This is because government bills are processed slower than legislator-initiated bills because they must undergo review by the Ministry of Legislation and deliberation by the Cabinet before being submitted to the National Assembly.
The Special Judicial Police for Public Welfare Finance is expected to launch in January of next year, following the passage of the bill as early as this coming September or October. Multiple financial authorities stated, "We have consulted with the Ministry of Justice to include the Debt Collection Act in the scope of investigation," adding, "We plan to accelerate the drafting of the bill and launch a special investigative unit for public welfare next year.
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[email protected] Lee Ju-mi Reporter