MiningMax Fraud Case: 10 Years of Truth

Reporter Kwon Ji-yeon pointed out that it is difficult to find a precedent for criminal mediation in such a large-scale multi-level marketing financial fraud case. The prosecution cited victim recovery as justification, but the lawyers' side maintains that mediation itself was an impossible approach given the nature of a large-scale case.

Reporter Kwon Ji-yeon stated that it is difficult to understand how the Incheon District Prosecutors' Office's Foreign Affairs Division proceeded with criminal mediation with affiliate representatives despite Park Nam-ho's escape. Criticisms were raised that the mediation took place without sufficient verification of the victims' identities, and there was a lack of transparency in the prosecution's process of distributing seized assets.

Kim Sam-il expressed deep distrust regarding the entire process of the prosecution's search and seizure and victim recovery measures. The whereabouts of a significant portion of the funds the prosecution intended to recover have not been clearly disclosed, raising increasing suspicions among victims.

According to the cafe operator, the prosecution reportedly ordered that these parts be disposed of and distributed. The cafe operator initially took the lead in disposing of some parts and attempting distribution but was later excluded from the distribution process.

Reporter Kwon Ji-yeon criticized the very idea of proceeding with a mediation agreement with only a small number of victims as inappropriate. The remaining 14,000 to 15,000 victims were essentially excluded, and transparency was lacking, with representatives being selected through a process closer to notification than victim consent.

Lawyer Lee Min-seok pointed out that, contrary to expectations that the groups would consist solely of genuine victims, there were many multi-level marketing members posing as victims. Cases of hiding or distorting information for fear of being reported if they told the truth were frequent, and a structure was formed where these intermediate recruiters intervened in victim representation.

Reporter Kwon Ji-yeon expressed skepticism about the use of nicknames in an agreement document, revealing that even a former vice president of a multi-level marketing organization signed with a nickname. The admission of using nicknames such as 'Jirisan' and 'Naegaero' exposed the reality of individuals who could be considered perpetrators being mixed in with victims.

Lawyer Lee Min-seok explained that even among victims, opinions are divided between those who prioritize punishment of perpetrators and those who prioritize recovery of damages. Some victims participated in the mediation to recover at least half of their funds, but suspicions arose that the prosecution used criminal mediation to show leniency to Park Nam-ho and Mr. Yoon.

Lawyer Lee Min-seok assessed this as a matter requiring approval from a high-ranking official beyond the level of an Incheon District Prosecutors' Office department head. There is a large discrepancy between media reports that the prosecution worked hard for victim recovery and the actual situation, and suspicions of an intentional approach are raised regarding criminal mediation initiated by the perpetrators' side.

Lawyer Kang argued that the majority of victims were not 'ordinary people' but 'multi-level marketing salespeople'. Reporter Kwon Ji-yeon stated that this categorization seemed to be an attempt to blur the lines between victims and perpetrators and obscure the essence of the matter.

Lawyer Lee Min-seok questioned why the Foreign Affairs Division only proceeded with mediation agreements when it should have apprehended Park Nam-ho. Criticism arose that focusing solely on investigating high-level accomplices resulted in neglecting intermediate and lower-level recruiters.

Lawyer Lee Min-seok explained that fraud cases rapidly increased from that point. The structure of fraud changed to include cryptocurrencies and private equity funds, and suspicions of intervention by former public officials and tacit approval by authorities were raised. There were also cases of additional fraud occurring during trials, such as the Kim Sung-hoon case of IDS Holdings.

He also acknowledged that there was a consultation process with victim groups.

Lawyer Lee Min-seok explained that this method was one way to achieve procedural fairness. Discussions took place through victim group meetings, and a proportional distribution of 20-30% of the estimated damages was proposed.

Lawyer Lee Min-seok emphasized the need to distinguish between the amount stated in the indictment and the amount victims actually received as commissions. This adds to the complexity of calculating damages and affects the criteria for victim recovery.

Reporter Kwon Ji-yeon criticized that it is difficult to understand such a ruling in Korea, where plea bargaining does not exist. Compared to the IDS Holdings case where a recruiter received 2 years and 6 months in prison for 40 billion won, questions are raised about the appropriateness of the punishment level beyond mere cooperation with the investigation, even if there was an internal tip-off.

This is seen as an acquisition of the Korean corporation using the US corporation's governance structure, raising questions about the circumstances of CEO Yoon's dismissal as an inside director.

Lawyer Lee Min-seok explained that Mr. Yoon, aware of the legal risks of unauthorized asset transfer, sought advice and then passively refused the order. Ultimately, Mr. Yoon's actions led to a report to the prosecution.

Lawyer Lee Min-seok warned that if criminal mediation proceeds in this manner, it could set a precedent for accomplices to escape. This is because the prosecution conducting criminal mediation before indictment could frame perpetrators as 'public interest whistleblowers,' and the court could also form a favorable impression of the perpetrators based on the agreement. Ultimately, it could lead to criminals who should receive heavy sentences being released with suspended sentences.

Victims strongly protested when a former prosecutor who defended Kim Pan-jong, the main culprit in the KOK case, was considered as a candidate for the head of the Central Investigation Agency. Lawyer Lee Min-seok pointed out the unfairness of someone who defended a fraudster becoming an official candidate. This led to distrust in the fairness of investigations and further increased the emotional resentment of financial fraud victims.