President Lee Jae-myung said on the 6th that the government will support housing stability and a swift recovery for victims of jeonse fraud, after the Cabinet approved a revised enforcement decree of the Special Act on Support for Jeonse Fraud Victims and Housing Stability. Jeonse is a Korean lease system requiring a large lump-sum deposit instead of monthly rent.
Lee posted a message on X, formerly Twitter, under the title "We will help jeonse fraud victims return to normal life quickly." "At today's Cabinet meeting, we approved a revised enforcement decree to support victims of jeonse fraud," Lee wrote. "So that victims are not delayed in returning to their daily lives while waiting on procedures and time, the government will support housing stability and a swift recovery."
Lee added that starting Nov. 13, victims who fail to recover one-third of their deposit even after auction or public sale procedures will be compensated for the shortfall. "For victims who find it difficult to recover their deposits through auctions or public sales, such as in trust fraud cases, support will be provided before the procedures are completed," he said.
The revised decree sets out detailed criteria for calculating support payments and procedures for disbursement under a minimum guarantee scheme, which ensures victims recover one-third of their lease deposit, and under an advance-payment-and-later-settlement system for those who signed contracts with parties lacking legal authority, such as in trust fraud cases. The minimum support payment is calculated by taking the minimum guaranteed amount, equal to one-third of the lease deposit, and subtracting amounts already received through the exercise of statutory lease protection rights (opposing third-party claims) or priority repayment rights, amounts repaid through claims for return of the lease deposit, auction proceeds and rental support payments.
The Korea Land & Housing Corporation (LH) will handle the payment and settlement of minimum support payments and advance payments. The revision also establishes a procedure allowing the Ministry of Land, Infrastructure and Transport (MOLIT) to access information on landlords' debts and overdue payments as needed for jeonse fraud victim support.
