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"Is it too easy?"... Moving 5 companies and embezzlement of 900 million won, why didn't I know [Republic of Embezzlement ①]

joongang ilbo

Input 2022.12.22 05:00

Reporter Park Young-min

Reporter Jeong Se-hee

Embezzlement causes companies to stumble and causes damage to numerous stakeholders. According to the prosecution's 『Quarterly Crime Trend Report』, there were 51,793 crimes of business embezzlement last year. This is a 34% increase from 38,646 cases in 2014. This represents an average annual increase of about 5% over the past 7 years.

JoongAng Ilbo Innovation Lab analyzed existing cases to analyze the structural causes of embezzlement. In the court reading service, 100 cases of one year's worth (2021.8-2022.8) of the 1st and 2nd trial criminal cases in which the facts of business-related embezzlement were disclosed were thoroughly investigated. Embezzlement within a financial company, which is a professional crime, was excluded. This is to understand the pattern of embezzlement taking place in ordinary companies in the non-financial sector.

As a result, the true face of the embezzlement republic was revealed, from bookkeepers to executives to university presidents involved in crimes. It is published in two parts. The contents of the judgment have already been anonymous, but the story has been reconstructed so that the case and the person involved in the case cannot be identified in order to prevent invasion of privacy. [Editor's Note]

Reconstruction of Embezzlement Republic ① Incident: The Turnover of Serial Embezzler A

Business-related embezzlement crimes that occurred last year increased by about 34% compared to 2014. Graphic designer Yujin Jeon yuki@joongang.co.kr

Mr. A joined a small and medium-sized business in Seoul in 2018 as an accountant. On the second day after he went to work, he transferred 3.5 million won from his company account to his own account. 'Is it too easy?' After 20 extra he moved another 99k. 1 million won the next week, 1.1 million won again... . A stole 8 million won, which is more than four times his monthly salary, within 15 days of going to work. He didn't stay at one job for long. He moved his enemies to a total of five companies over three years through 2021. His turnover became more drastic with each turn. Unlike the early days when transfers were made in units of 1 million won, the transfer amount grew like a snowball with 10 million won and 30 million won. He siphoned out as many as 50 million won at once, and in the last company, he embezzled more than 500 million won in 8 months.

The embezzlement continued even during the investigation and trial after the crime was discovered. When he was accused by his former employer, who belatedly found out after his resignation, he compensated for his damages with the money he embezzled from the new company. Both the police and the prosecutor raised their hands and feet in the technique of 'blocking compensation with embezzlement money'.

Mr. A's history of embezzlement that no one knew

Mr. A was in charge of cashier work. The official certificate required for fund transfer from the corporate account and the OTP card of the employees were in the hands of Mr. A. It was not a task for him to transfer about 1 million won through online banking with only an official certificate and an OTP card. He also forged documents to embezzle more money. It was a method of extorting corporate funds by deceiving bank employees after creating a fake power of attorney to the effect that the CEO delegated himself as an agent.

The court sentenced Mr. A to 6 years in prison for embezzling a total of 900 million won over 120 times. However, the company's damage has not been recovered. Mr. A only reimbursed 100 million won to one of the damaged companies in a way to prevent it.

In fact, in 2016, before serial embezzlement was discovered, Mr. A had a history of being fined for embezzling about 10 million won. However, there was no way to find out about Mr. A’s criminal record or black intentions in the five companies he joined afterwards. All five companies did not have a system that could prevent embezzlement by accounting staff.

100 Stories of Business Embezzlement

Each of the 100 rulings had a different story. The JoongAng Ilbo classified the case according to three criteria: ▶ Who was the criminal, ▶ How much was the damage, and ▶ What kind of judgment did the court give to the criminals?

Graphic designer Yujin Jeon yuki@joongang.co.kr

who embezzled

There were 44 managerial positions such as auditor, general manager, and secretary general, 22 accounting positions, 9 general employees, and 7 sales positions such as sales staff. There were 11 executives, including CEO, vice president, university president, branch manager, and managing director. In addition, there were seven defendants whose titles could not be confirmed only with the written judgment.

Graphic designer Yujin Jeon yuki@joongang.co.kr

how much did you steal

Comprehensive, the amount of embezzlement ranged from a minimum of 1.5 million won to a maximum of 900 million won. The average amount of embezzlement is 138.66 million won. Compared to the total amount of embezzlement (13.7 billion won), the amount of reimbursement was only about 3 billion won (22%). Out of 100 cases, there were only 12 cases in which the accused paid full compensation to the victim. Excluding 11 cases in which the defendant compensated at least partially and 12 cases in which compensation was promised in the future, in 65 cases, not a penny was returned and the company took the damage.

Graphic designer Yujin Jeon yuki@joongang.co.kr

what was the punishment

A total of 92 out of 100 cases were sentenced to imprisonment by the court. Among them, 53 cases were suspended sentences and 39 cases were actual sentences. The shortest sentence is 6 months in prison and the longest sentence is 6 years in prison. The former accountant A, who was sentenced to 6 years in prison and is serving a sentence, is Mr. A, whom I introduced earlier.

8 fines. The fine amount ranged from a minimum of 1.5 million won to a maximum of 10 million won. In seven of the eight cases, the court imposed the condition that 'if the defendants fail to pay the fine, the defendant will be detained in the labor camp for a period of 100,000 won converted into one day'. He was also ordered to pay an amount equivalent to the fine. A payment order is a disposition that requires the defendant to pay an amount equivalent to the fine before the sentence becomes enforceable in case the defendant is unable to pay the fine.

4 embezzlement schemes that cheat companies

account transfer type

Mr. B, an employee of the Business Management Office, said that he would purchase items such as masks from the accountant, and after receiving the account password, he transferred 8 million won of public funds to his father's account using an official certificate and OTP card stored in the office safe. In this way, he embezzled 67 million won on a total of four occasions.

Moving company money into your own account is one of the most common types, with 45 out of 100 cases. Those who dug into lax points in fund management attempted embezzlement several times by account transfer method. Most of the cases were to transfer funds from company accounts to their own accounts, and there were also cases of remittances to family members or acquaintances such as wives, children, sisters-in-law, and friends.

Use of public funds

Mr. C received a cash card and account password from the company under the pretext of purchasing goods, and then withdrew 700,000 won from the company money from an ATM and used it for personal purposes. Since then, a total of 120 million won was embezzled 165 times in the same way.

This is a case where an account, card, or cash in the name of a corporation was used at will. Again, 45 out of 100 were of this type. Embezzlement in the form of misappropriation of public funds occurred in various industries such as sales, sales, general affairs, and accounting. In some cases, the sales team took some of the payment received from the customer, or the sales team employee received the price of the product in cash and kept it separately.

document forgery

Mr. D, the president of the school corporation, accounted for his business promotion expenses as if he had given them to others as encouragement money. However, Mr. D did not actually issue it and used it for other purposes. In this way, he embezzled a total of 5 million won. Mr. E, who was in charge of sales management, embezzled over 100 million won on a total of 154 occasions by amending the work log and then withdrawing the difference from her.

It is a case of forging documents in order to embezzle large amounts of money. This type reached 18 out of 100 cases. By manipulating public documents such as ledgers, he collected more than the original amount to be received, or manipulated the situation as if he had never collected money from the customer. In the case of document forgery-type embezzlement cases, the crime of forgery of private documents and the use of forged documents were also applied in most cases.

product sales

Mr. F, a factory manager who works at a mask manufacturer, randomly sold 80,000 masks and stole 70 million won. People who bought masks from him resold them to others and made a profit.

It is a case where the company's private property or products are arbitrarily taken out and sold and the money earned is put into the pocket. Thirteen out of 100 cases were of this type. If you hand over the goods to someone else or use them for yourself, it is considered business breach of trust, but business embezzlement is applied when you collect sales money through a transaction.

It is not uncommon for the above four types to appear in combination. Document manipulation/misappropriation of public funds (7 cases), account transfer/document manipulation (4 cases), account transfer/misappropriation of public funds (3 cases), arbitrary use/sale of goods (3 cases), document manipulation/sale of goods (2 cases) case), etc. appeared simultaneously.