Case Type: Fraudulent Rehabilitation Offense / Personal Rehabilitation / Criminal Complaint Related to Fictitious Debt Claims

Result: Review of fictitious debt structure and filing of criminal complaint

Case Details:

The client had obtained a final court judgment confirming a debt of approximately KRW 300 million and was preparing enforcement proceedings against the debtor. However, the debtor unexpectedly filed for personal rehabilitation, resulting in restrictions on compulsory enforcement.

During the review of the rehabilitation records, suspicious claims listed in the debtor’s creditor schedule were identified. The first listed creditor was the debtor’s former spouse, claiming approximately KRW 100 million in alleged child support and loan obligations.

However, the debtor and the former spouse had already been divorced for more than ten years, and multiple circumstances suggested that the alleged debt lacked any substantial financial basis. There were no meaningful transaction records or financial evidence supporting the existence of the claimed debt.

In particular, issues arose regarding the debtor’s financial condition at the time the notarized document was created, the absence of actual money transfers, and the questionable basis for the alleged claim itself. It was also noted that during the rehabilitation proceeding, the creditor’s name was later transferred to the debtor’s son.

Accordingly, the case focused on whether the conduct constituted a fraudulent rehabilitation offense under the Debtor Rehabilitation and Bankruptcy Act. Such an offense may arise when a debtor creates fictitious liabilities, conceals assets, or otherwise acts to disadvantage creditors, followed by confirmation of the rehabilitation proceeding.

The matter involved a comprehensive review of the alleged fictitious debt structure, financial transaction history, possible collusion among family members, and the overall rehabilitation process, leading to the filing of a criminal complaint.

Although personal rehabilitation is intended to support financial recovery, misuse of the system through fictitious debts or concealed assets may result in criminal liability beyond ordinary civil disputes. Careful legal and factual analysis is therefore essential.

Case Inquiry: Attorney Kim Minhoo