Illegal Loan Sharking Organization Using Nudes as Collateral Arrested

An illegal private financing organization that lent money at astronomical interest rates to young adults and others in urgent need of cash, and then blackmailed them by threatening to distribute nude photos and videos taken as collateral, has been caught by the police.

The Busan Metropolitan Police Agency announced today (August 31) that it has apprehended 29 individuals, including 17 members of the organization such as a man in his 30s surnamed A who served as the ringleader, 2 criminal proceeds laundering agents, and 10 suppliers of burner bank accounts, on charges including forming a criminal organization, violating the Loan Business Act, and violating the Act on Special Cases Concerning the Punishment, etc. of Sexual Crimes.

Police have forwarded 12 of them, including A, to prosecutors in custody, while sending the remaining 17 without detention.

A and his accomplices are accused of operating an illegal private financing criminal organization established in Daegu in July 2023 and conducting illegal lending operations targeting 558 people, including young adults, using 40,501 pieces of illegally acquired personal information until December 14, 2025.

They lent a total of 1.4 billion won at exorbitant interest rates reaching an annualized rate of up to 40,150%, such as lending 500,000 won and demanding 1.05 million won including 550,000 won in interest the very next day, while receiving the victims' nude photos or videos under the pretext of collateral.

If victims failed to repay the money on time, A's gang threatened to distribute the problematic photos and videos to their families and acquaintances.

One victim, suffering from debt collection, sent a photo of self-harm to A's gang, but the gang instead sent that photo to the victim's family and continued their threats.

During the criminal period, the interest income alone pocketed by A's gang amounted to 1.2 billion won.

By analyzing burner phones and dummy accounts used in the crime, the police identified three offices located in Daegu and the organization members operating under aliases, ultimately arresting all 17 members including the ringleader.

Subsequently, based on their Telegram group chat rooms and profit distribution records, police applied charges of forming a criminal organization, and additionally arrested agents who concealed criminal proceeds by disguising them as gift certificate transactions as well as suppliers of dummy accounts.

Police explained that they seized 42 million won in criminal proceeds and received approval from the court for pre-indictment preservation of 240 million won worth of assets, including vehicles and deposits.

A police official urged, "Even if you are in urgent need of cash, you should not use malicious illegal private financing that even demands nude photos, but instead use legitimate financial systems such as 'subsidized microloans for low-income earners'."

(Photo provided by Busan National Police Agency, Yonhap News)
※ Please note: This article was translated by AI and may contain errors.