The chairman of the association promotion committee and the representative of the business agency were brought to trial on charges of inflating the progress of the local housing association business and stealing 23.9 billion won in down payment by recruiting homeless members.

Yesterday (8th), the Seoul Southern District Prosecutor's Office 1st Division (Chief Judge Wonji Kim) arrested and indicted the union promotion chairman A and the business agency representative B on charges of breach of trust under the Act on the Aggravated Punishment of Fraud and Specific Economic Crimes, and charged Mr. C, the representative of the union recruitment agency. He was charged without detention on fraud charges.

From November 2016 to September 2019, they recruited 477 union members by inflating the land security rate and received 23.9 billion won as a down payment.

The local housing association promoted it as if it was possible to move in in 2021 as 60% to 80% of the land use rights were secured, even though it was difficult to proceed with the project in a short period of time because it did not get the consent of the actual landowners.

In order to obtain approval for the establishment of a local housing association, it is necessary to 'Secure the right to use more than 80% of the land area for housing construction'.

In fact, the 'land use consent' they secured was 25% as of 2018, and the land purchase rate was only 2.7% as of 2018.

In addition, Mr. A and others incurred a loss of 2.3 billion won to the union by executing the union contract money in a place unrelated to the business. It is also known to have invested. 

It was confirmed that only a portion of the cooperative funds were used to purchase land for the project, so the local housing association project was virtually in jeopardy of bankruptcy.

An official from the prosecution said, "We will take strict measures against corruption cases of local housing associations that produce multiple damages to the common people."

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