Surviving a ‘republic of fraud’ Suh Kyoung-ho The author is an editorial writer of the JoongAng Ilbo. The Jeon Cheong-jo scandal, which recently shook Korean society, has left a bad taste in the mouth. Due to the sensational recipe — a transgender con artist posing as a scion engaged to a same-sex female fencing star — the media jumped on the hot topic. But fraudulent acts are not confined to the odd couple . Fraud crimes amounted to 320,000 cases last year, adding more than 50,000 cases from five years ago. The most common case is voice phishing, fraudulent phone calls that emerged in 2006 to trick people to give away their money or private information. In 2021, money lost to voice phishing amounted to 774.4 billion won ($584 million). Korea has become a republic of fraud, with fraudsters robbing 2.1 billion won a day on average. The well-educated are equally vulnerable. Once malware gets into someone’s phone, the fraudsters can access all of the user’s calls, and the calls they receive won’t look suspicious at all. Police points to this detail as the biggest threat of the phishing crime. When victims report suspicious activities to the authorities such as the police, the prosecution, or the Financial Supervisory Service, the fraudsters will know that a report has been filed right away. The Chungnam Provincial Police Agency recently caught a voice phishing crime ring that ripped off 149.1 billion won from 1,891 people. Among the victims was a doctor who lost 4.1 billion won and a Seoul National University professor who lost 1 billion won. There were as many as 5,500 cases that were merged into the phishing crime. Kim Jong-min, director of the economic crime investigation bureau at the National Office of Investigation, called it the biggest phishing case in history. Scams have evolved in line with the advances in financial and telecommunications technologies. Scammers are riding the digital wave as smartphones and fintech become integral to everyday life. Open banking fuels the scam, as the service enables access to bank accounts — and money transfers — across financial institutions. Fraud cases involving digital assets jumped from 467.4 billion won in 2017 to 3.13 trillion won in 2021. The rise in jeonse (upfront lump-sum rent deposit) fraud last year totaled 233.5 billion won. The ratio of fraud cases among all other crimes stood at 23 percent from January to July this year. Burglaries fell below fraud from 2015. Robbing has become old-fashioned due to the increase of security cameras and fewer people hoarding hard cash. Fraud does not just cost money. They eat away the social capital of trust. Lies and false accusations are particularly common in Korea. The excess of distrust can demand a higher social cost for transaction. Since we cannot trust strangers, we rely on blood and connections and tolerate tribalism, costing the country its competitiveness. The economic repercussions from fraud are big. As frauds become globalized and advanced, it has become harder to catch the criminals. Since noncontact methods have become commonplace, identifying the criminals has become difficult. They use virtual private networks (VPNs) to escape the online chase by law enforcement authorities. Fraud arrests fell to 59 percent last year from 75 percent in 2018. When the criminals sense the police, they can easily escape overseas. More than half of the 52 percent of the criminals on the run were charged for fraud from 2020 to 2022. Seo Joon-bae, a professor at Korea National Police University, observed that “the police cannot catch con artists flying away in rockets, as police officers chase them in used cars,” adding it is important to put in place “psychological CCTVs” to control their criminality. The police are doing their best. It has been cracking down on fake bank accounts, phones, and USIM mobile phone cards. Fees for a fake bank account jumped tenfold as a result. Making the cost of committing a crime expensive can help contain the crime. The government has been running an integrated call center since September to receive complaints on voice phishing for immediate action. The crimes can be reported to the call center by dialing 112 or visiting the anti-voice phishing website, as the separate functions of the police, the Financial Supervisory Service, and the Korea Internet & Security Agency have been consolidated on those channels. Most importantly, everyone must look out for themselves. Links received in text messages should not be opened as a rule of thumb. If clicked on by accident, make sure not to tap “confirm” in the pop-up window. Money should not be sent to family members or acquaintances right after getting a call, as criminals use artificial intelligence to clone voices or faces today. The world is turning scarier by the day.