[Why We Checked] On April 28, a post appeared in the Danggeun Market gallery on DC Inside questioning a Danggeun Market user who had demanded a criminal background check certificate while recruiting a babysitter, asking, "Isn't it illegal to demand a criminal background check certificate?" A similar question was raised on Blind on March 18. That poster likewise quoted a Danggeun Market user's job ad and responded, "Isn't demanding a criminal background check certificate itself a criminal act?"As information and communications technology advances, more and more people are hiring babysitters (child care helpers) directly, person to person, through online platforms. Being able to find a babysitter directly is convenient, but since it means entrusting someone with child care, people may also feel anxious about whether the applicant's identity and background are clear. Because individuals without sufficient legal knowledge are recruiting on their own, new legal questions are arising over what, and how much, an employer may demand from a job seeker. We examine whether it is lawful for an individual recruiting a babysitter to demand a criminal background check certificate. [Fact-Check Summary]- Under Article 6, Paragraph 3 of the Act on the Lapse of Criminal Sentences (hereinafter the 'Lapse Act'), no one is permitted to obtain another person's criminal record data except in cases prescribed by law.- Heads of child- and youth-related institutions that hire babysitters and similar workers have the duty and authority to check for sex offenses and child abuse crimes at the time of hiring, under the Act on the Protection of Children and Youth against Sex Offenses (Article 56, Paragraph 5) and the Child Welfare Act (Article 29-3, Paragraph 5).- However, not everyone who hires a babysitter is given this duty and authority; only institutions meeting the legal requirements and qualifications may check a prospective employee's criminal record.- When recruiting a babysitter through an online platform or the like, an individual, unlike an institution, has no legal status as a child- and youth-related institution. Accordingly, no authority to check criminal records is granted.- An individual's act of demanding criminal record data from a babysitter may be unlawful, since it can actually lead to an exchange of criminal record data. However, the core acts directly prohibited by the Lapse Act are obtaining and using criminal record data, and legal experts are divided on whether the act of demanding it is itself unlawful.- The claim under review, 'demanding a criminal background check certificate is illegal,' is broadly consistent with the facts, but it omits context in that the act directly tied to illegality is not the demand itself but the obtaining and use of criminal record data. Danbi News therefore rates the claim 'Mostly True.' [How We Checked]- We reviewed the Lapse Act to confirm when criminal record inquiries and the obtaining of criminal record data are permitted.- We reviewed the Personal Information Protection Act to confirm whether criminal record data constitutes sensitive information.- We reviewed the Act on the Protection of Children and Youth against Sex Offenses to determine whether child- and youth-related institutions are obligated to check prospective employees' sex offense records at the time of hiring.- We reviewed the Child Welfare Act to determine whether child- and youth-related institutions are obligated to check prospective employees' child abuse crime records at the time of hiring.- We reviewed the Act on the Protection of Children and Youth against Sex Offenses and the Child Welfare Act to determine the legal requirements for child- and youth-related institutions that are qualified and obligated to check prospective employees' sex offense and child abuse crime records.- We asked attorneys about the legality of demanding and obtaining criminal record data when an individual recruits a babysitter person to person.[What We Found]On April 28, a post titled "Isn't this illegal?" appeared in the Danggeun Market gallery on DC Inside. The post quoted a screenshot of a Danggeun Market job ad seeking someone to look after an 18-month-old girl at home. In the captured material, the person who posted the ad was demanding a criminal background check certificate as a required document. The DC Inside user raised the question, "Isn't it illegal to demand a criminal background check certificate?"Why do people want to check a babysitter's criminal record even though it may violate the law? Koo Kyung-ri (25), who is raising a kindergarten-age child in Busan, said, "Since you're entrusting your child to someone even for a short while, you feel anxious when it's someone other than family. If I could check for a history of crimes such as sex offenses for safety reasons, I would want to." Jang Eun-jin (50), who lives in Daegu, said, "I occasionally look after my 5-year-old niece who lives near my home. With incidents and accidents so common, if I had to leave a child with someone for a long stretch, not just an hour or two or a drop-off and pick-up helper, I would want to check their criminal history as well."◯ Checking another person's 'criminal record data' is, as a rule, not permittedWhat exactly is a criminal background check certificate? Although the term is commonly used in everyday life, no document issued by a government agency actually bears the name 'criminal background check certificate.' What is usually called by that name corresponds to 'criminal record data' or 'investigation record data' under the Act on the Lapse of Criminal Sentences (the 'Lapse Act'), and the official document issued for it is the 'criminal and investigation record report.' Article 2, Item 5 of the Lapse Act defines the scope of 'criminal record data' as data containing information on sentences or dispositions such as: sentences of a fine or heavier, remission of sentence and suspended sentence; protective custody, medical treatment and custody, and probation; lapse of a suspended sentence; revocation of a suspended execution; and confiscation, forfeiture, community service orders and attendance orders imposed together with a sentence of a fine or heavier. The criminal and investigation record report contains virtually everything about an individual's criminal history. Anyone who wishes to check their own criminal record can obtain it through the Korean National Police Agency's criminal record report issuance system.As a rule, inquiring into, using or obtaining another person's criminal record data is not permitted. Article 1 of the Lapse Act states its legislative purpose as 'guaranteeing the normal return to society of persons with criminal records by setting standards for the management of criminal records and investigation record data.' Attorney Shin Dong-woo of DAEON Law Firm explained, "The purpose (of this Act) is to protect the social interest in the rehabilitation of ex-offenders by ensuring that an individual's criminal record is not disclosed carelessly." Attorney Choi Ji-young of Law Firm Beopseung also emphasized, "The legislative purpose of the Lapse Act is to guarantee ex-offenders' return to society by restricting acts such as the inquiry, use and obtaining of criminal record data by unauthorized persons." Attorney Chae Da-eun of Law Firm Hanjoong explained, "There are broadly two legal interests the Lapse Act seeks to protect. The first is the right to informational self-determination, so that sensitive personal information such as criminal records is not needlessly disclosed or circulated; the second is guaranteeing rehabilitation, so that ex-offenders can lead normal lives in society without stigma."Criminal record data is classified as sensitive information. Article 18 of the Enforcement Decree of the Personal Information Protection Act defines the scope of sensitive information, and Item 2 explicitly lists 'criminal record data.'◯ Child- and youth-related institutions must run a 'criminal record inquiry' when hiringThe story is different, however, when a child- and youth-related institution hires someone. It is required to check prospective employees for sex offense and child abuse crime records. Babysitters and child care workers employed by child care service providers or public child care centers are also subject to criminal record checks. The purpose of this system is to protect children and youth from sex offenses and child abuse crimes.Article 6, Paragraph 1 of the Lapse Act sets out the exceptional circumstances in which another person's criminal record data may be obtained or checked. Under that provision, obtaining or checking another person's criminal record data is permitted where necessary for a criminal investigation or trial, for the naturalization or residence permit of a foreigner, for the appointment of public officials and military personnel, and in other cases where another statute provides for criminal record and investigation record inquiries and notification of their results. The reason child- and youth-related institutions may check prospective employees' criminal records is precisely that this falls under the exceptions under individual statutes provided for by the Lapse Act.The head of a child- and youth-related institution must, during the hiring process, confirm that the prospective employee has no record of sex offenses or child abuse crimes. Article 56, Paragraph 5 of the Youth Sex Protection Act and Article 29-3, Paragraph 5 of the Child Welfare Act stipulate this. Under these two provisions, there are broadly two ways to check criminal records. One is for the head of the institution to obtain the prospective employee's consent to a criminal record check and then be notified by the Korean National Police Agency whether the person has any sex offense or child abuse crime record. The other is for the prospective employee to look up their own criminal record and submit the result to the institution. In this case, the head of the institution may require the prospective employee to submit criminal record data directly so that their record can be verified.Attorney Chae Da-eun added, "The types of crimes that child- and youth-related institutions may check under the law are limited to sex offenses against children and youth and sex offenses against adults under Article 56 of the Youth Sex Protection Act, and child abuse crimes under Article 29-3 of the Child Welfare Act, and in every case the duty to check is imposed on the head of the institution. Conversely, for ordinary criminal offenses such as theft or assault, even a child- and youth-related institution cannot request a criminal record inquiry without a separate legal basis."That said, not every institution or facility engaged in child- and youth-related work may check job seekers for sex offense or child abuse crime records. Article 56 of the Youth Sex Protection Act and Article 29-3 of the Child Welfare Act impose the duty to check sex offense and child abuse crime records when hiring or assigning staff only on child- and youth-related institutions that are authorized, licensed, reported or registered under the law, such as kindergartens, day care centers, private academies, child welfare facilities and youth training facilities. Only public and private institutions established within the scope defined by law hold the duty to check criminal records and the authority that comes with it.The Child Care Support Act has likewise regulated institutions carrying out public child care support programs, and from April 2026 it also brought into the formal system private child care service providers that meet certain facility and staffing standards and liability insurance requirements and are registered with local governments. Whether public, or private and registered after meeting these requirements, any entity operating child care services on a legal basis is subject, under the Child Care Support Act, to the legal basis for criminal record checks on care workers and to the management and supervision framework.By contrast, facilities and institutions that have not gone through the legal procedures, such as unregistered academies, unreported study rooms and unlicensed child-minding rooms, do not qualify as child-related institutions or child care service providers as defined by the Youth Sex Protection Act, the Child Welfare Act or the Child Care Support Act, even if they engage in child- and youth-related work. Although such facilities are used as a practical child care alternative by dual-income families and others, they have neither the legal duty nor the authority to check sex offense or child abuse crime records, and they lie outside the reach of the public safeguards designed on that premise.◯ Can an individual also demand 'criminal record data' when hiring a babysitter?With advances in information and communications technology, it has become common to find a babysitter person to person through a platform. When an individual, rather than the head of a child- and youth-related institution subject to the law, recruits a babysitter, is it legally possible to demand criminal record data?Judging from a recent post on Danggeun Market, opinions were divided among platform users as well. On a post titled 'Is it illegal to demand a criminal background check certificate between individuals?' some commented, "Since the work involves a minor, there are grounds for requiring it," and "If it's child-related work, it's only natural to ask for a check of child abuse and sex offense records," while others wrote, "It's illegal," and "Since it's private employment, doesn't that not apply?"A post that appeared in Danggeun Market's 'Neighborhood Life' community around March, along with the comments on it. Opinions are divided over whether it is illegal to demand the submission of criminal record data when recruiting a babysitter between individuals. Captured from the Danggeun Market communityWhen an individual recruits a babysitter on a platform such as Danggeun Market, they cannot demand and receive a criminal background check certificate. Such an act may violate the Lapse Act, the Personal Information Protection Act and other laws. Attorney Lee Seung-woo of Law Firm Jeonghyang explained, "Demanding criminal record data when recruiting between individuals on Danggeun Market may violate Article 6, Paragraph 3 of the Lapse Act or Article 23 of the Personal Information Protection Act." Article 6, Paragraph 3 of the Lapse Act stipulates that no one may obtain criminal record data or investigation record data for the purpose of using it other than as prescribed by statute. Article 23 of the Personal Information Protection Act concerns restrictions on the processing of sensitive information.Attorney Song Jae-bin of Law Firm Veteran explained, "As a rule, demanding a criminal record check in the hiring process is not allowed." He said, "Except in the exceptional cases prescribed by law, a criminal record check cannot be demanded," adding, "Whether it is recruiting a babysitter between individuals or hiring by a private company, demanding a criminal record check is problematic even with the consent of the parties."Attorney Ahn Jun-hyung of Law Firm Jihyeok explained, "If you actually obtain a copy of your criminal record data, it says at the bottom of the document that 'use for any other purpose is prohibited,'" adding, "That means a criminal record check cannot be demanded except in the exceptional cases prescribed by law." He said, "As a rule, whether it is recruiting a babysitter between individuals or hiring by a private company, the very demand for criminal record data is not allowed," and "The intent of the law from the outset is to prevent the demand itself, not to permit an exchange based on consent."Other experts said that the demand for criminal record data is not itself grounds for punishment, but that actually obtaining it is the problem. Attorney Shin Dong-woo of DAEON Law Firm drew a distinction between 'demanding' and 'obtaining,' saying, "Demanding criminal record data is not in itself designated as grounds for punishment, but if criminal record data is actually obtained, there is a possibility of illegality." On the illegality of obtaining the data, Attorney Shin explained, "If a job seeker actually submits criminal record data intended for verifying their own record, merely receiving that data constitutes 'obtaining for a purpose other than the prescribed one,' and for the job seeker it constitutes 'use for a purpose other than the prescribed one.'"Attorney Choi Ji-young of Beopseung also said, "Whether the act of demanding the submission of criminal record data in a job posting is itself contrary to the Lapse Act is open to dispute." However, like the other attorneys, Attorney Choi took the view that the act of obtaining the data may be illegal, saying, "If another person's criminal record data is actually obtained pursuant to the demand, it may violate Article 6, Paragraph 3 and Article 10, Paragraph 2 of the Lapse Act, among others, and the person who submitted it is also in breach of Article 6, Paragraph 4 of the same Act."Attorney Chae Da-eun likewise explained that what the Lapse Act prohibits lies in 'obtaining' and 'using' rather than the 'demand' itself. "The Lapse Act has no provision that directly punishes the act of demanding the submission of criminal record data," Attorney Chae said. "It is difficult to conclude that merely stating 'criminal background check certificate required' in a job posting constitutes a violation of the Lapse Act." She added, however, "If the demand actually leads to submission, a Lapse Act violation issue can arise for both the submitter (job seeker) and the recipient (employer)."Attorney Chae said, "A job seeker's act of obtaining their own criminal record data is itself lawful under Article 6, Paragraph 1, Item 4, but if it is obtained from the outset for the purpose of submission in a hiring review, it may constitute obtaining for use for a purpose other than the self-verification purpose permitted by Article 6, Paragraph 1." She added, "If the employer uses the submitted criminal record data for purposes other than the hiring review or provides it to a third party, an additional issue of violating Article 6, Paragraph 4 of the Lapse Act may also arise."The opinions of six experts on an individual's act of demanding and obtaining criminal record data. Graphic by Kim Yeo-jinOf the six attorneys Danbi News consulted for a legal interpretation, on the question of whether an individual may demand criminal record data when recruiting a babysitter in a private capacity, three attorneys said the demand itself may be illegal in light of the Lapse Act, two said that "looking at the act of demanding alone, it is not designated as grounds for punishment," and one said it is "open to dispute." But on an individual's obtaining another person's criminal record data, all six agreed without exception that it is illegal. Even if it is done by mutual agreement between private parties, the recipient (employer) commits the 'obtaining for another purpose' prohibited by law, and the giver (job seeker) commits 'use for another purpose.'○ The 'child care worker certificate': a lawful way to verify criminal historySo is there no lawful way at all for an individual recruiting a babysitter to verify criminal history? There is, in fact, a way: checking whether the person holds a 'child care worker certificate.'The national child care worker certification is a newly established system that took effect on April 23 of this year. Kim Chae-min, an assistant manager on the certification operations team in the child care support division of the Korea Institute for Healthy Family, explained the purpose of the system: "It is a system that improved the management framework in recognition of the anxiety parents feel about child care provided in the private sector. The goal is to secure the professionalism of care workers on the basis of an officially recognized certificate and to provide safer child care services."To obtain a child care worker certificate, a person must complete 160 hours of in-person training at an educational institution recognized by the Ministry of Gender Equality and Family. As of this year, there are 71 child care worker training institutions nationwide. In addition to in-person training, 16 hours of online training must also be completed. The 'KIHF Education Platform,' operated by the Korea Institute for Healthy Family, provides the online training for child care workers.After the training course is completed, the Korea Institute for Healthy Family checks for disqualifying grounds such as criminal records. Under Article 6 of the Child Care Support Act, persons with a record of sex offenses or child abuse crimes, persons with mental illness and persons addicted to psychotropic drugs are all regarded as disqualified. Obtaining a child care worker certificate therefore effectively means having passed a criminal record verification process. Song Jin-woo, a deputy director in the child care support division of the Family Policy Bureau at the Ministry of Gender Equality and Family, said, "During the certification process we verify everything, including criminal record inquiries and drug-related health examinations. A certificate holder can effectively be regarded as having completed verification on these points."Anyone recruiting a care worker can ask the applicant to show their 'child care worker certificate' and can easily verify its authenticity. Deputy Director Song explained, "A QR code is issued along with the certificate so that anyone can easily verify its authenticity. It makes it possible to effectively verify criminal history lawfully, without demanding criminal record data." As of the 3rd of this month, roughly 2,700 certificates had been issued.◯ Job posts demanding criminal record data: how far does platform liability extend?Taking our reporting together, a platform likewise cannot demand criminal record data for an individual job posting, and it is not currently possible for an employer to require the platform to disclose a babysitter's criminal record. This is because a platform is a business registered as a job information provider, online sales business or the like, not a child- and youth-related institution with the authority to demand a criminal background check certificate. Han Seung-soo, a manager at Danggeun Market, explained, "Verifying an individual's criminal record is possible only for institutions granted authority under the relevant statutes, so a platform legally cannot collect or store such information."Even if someone posts a job ad demanding criminal record data, it is difficult to hold the platform legally liable. Attorney Shin Dong-woo of DAEON Law Firm responded on this point, "With the governing provisions ambiguous, it would be difficult to impose legal liability."Attorney Chae Da-eun of Law Firm Hanjoong said of platform operators (such as Danggeun Market) leaving such job posts up, "There is no direct penalty provision under the Lapse Act," adding, "An issue of indirect liability could be raised in connection with the duty to prevent the circulation of illegal information under the Act on Promotion of Information and Communications Network Utilization and Information Protection, but at present it is hard to say definitively."Attorney Choi Ji-young of Law Firm Beopseung explained, "If a platform operator is aware of an unlawful hiring condition such as 'criminal background check certificate required' and nonetheless leaves it up or encourages it, whether it constitutes aiding and abetting could theoretically be an issue," adding, "But to establish that, the platform operator's intent must be proven, so in practice the likelihood of punishment is low."[Verdict]Obtaining another person's criminal record data is, as a rule, not permitted under the Lapse Act. If the practice of checking individuals' criminal records were to spread across society, ex-offenders could not escape negative perceptions such as the stigma effect, and their normal return to society could become difficult.The Lapse Act does, however, provide exceptions under which another person's criminal record data may be checked or obtained. The scope of those exceptions follows what the Lapse Act itself prescribes or what is stipulated in other statutes. When a registered institution providing child care services hires a babysitter or child care worker, it is obligated under the Act on the Protection of Children and Youth against Sex Offenses and the Child Welfare Act to check for a history of sex offenses and child abuse crimes. This is intended to protect children from crime; the institution must either obtain the prospective employee's consent to a criminal record check and be notified of the results by the Korean National Police Agency, or the individual must obtain their own criminal record data and submit it to the institution.Unlike an institution, however, an individual seeking a babysitter through an online platform or the like has no legal standing to check a job seeker's criminal record. Because an individual has not acquired the legal status of a child- and youth-related institution, they are granted neither the duty nor the authority to check criminal history under the Act on the Protection of Children and Youth against Sex Offenses and the Child Welfare Act.In response to online opinions that even an individual should be able to run a criminal record check, given that they are hiring a babysitter to protect a child, all six attorneys Danbi News consulted for a legal interpretation said that exchanging criminal record data is unlawful. They said that even if it is done by agreement between private parties, if criminal record data changes hands, the recipient (employer) commits the 'obtaining for another purpose' prohibited by law and the giver (job seeker) commits 'use for another purpose,' so there is a possibility of a legal violation. As for merely making the demand without actually obtaining the data, some attorneys regarded it as a violation of the law, saying "the intent of the law from the outset is to prevent the demand itself," while others expressed the view that it is "open to dispute."It is not the case that an individual recruiting a babysitter has no way at all to verify criminal history. Requiring a 'national child care worker certificate' makes it possible to lawfully confirm whether the person has a record of sex offenses or child abuse crimes. The national child care worker certificate is granted to those who have completed care-related training and have had their criminal history verified. Checking whether someone holds the certificate therefore has effectively the same effect as checking for a record of sex offenses or child abuse crimes.Taking our reporting together, an individual's act of demanding criminal record data from a babysitter can actually lead to an exchange (submission and obtaining) of criminal record data, and in light of the legislative intent of the Lapse Act, demanding criminal record data is, as a rule, not permitted. The statement 'demanding a criminal background check certificate is illegal' is therefore largely grounded in fact. However, the core acts directly prohibited by the Lapse Act are the obtaining and use of criminal record data, and legal experts were divided on whether the act of demanding it is itself unlawful. Since the act directly tied to illegality lies in the obtaining and use of criminal record data rather than the demand itself, the claim under review, 'demanding a criminal background check certificate is illegal,' is broadly consistent with the facts but involves a minor omission of context. Danbi News therefore rates the claim 'Mostly True.'Source: Danbi News (https://www.danbinews.com)

High-end matchmaking company Twenies has signed a partnership agreement with Attorney Shin Dong-woo. Through this appointment, Twenies plans to further strengthen the psychological safeguards for its Japanese female members while comprehensively upgrading its legal protection framework for safe international dating and marriage. To minimize the uncertainty and information asymmetry members may face on the journey of international dating and marriage between Korea and Japan, Twenies has standardized its legal guidance in key areas such as contracts, personal information and dispute prevention, and has strengthened its advance disclosure procedures. With Attorney Shin joining as advisory counsel, these internal standards are expected to be upgraded to be more professional and effective.Twenies CEO Ahn Jae-won said, "For people using a matchmaking service for the first time, meeting someone new carries as much risk as excitement. Especially since Twenies conducts international matching alongside domestic matching, that risk can feel doubled for our Japanese female members. That is why we place members' psychological stability and legal protection as our top priority, and this partnership agreement with Attorney Shin Dong-woo will be an opportunity to raise the high-end care standard we promise to the next level."Attorney Shin Dong-woo said, "International dating and marriage is an area where differences in culture, language and legal systems easily become entangled. I will work to provide clear information from a legal perspective, ensure procedural fairness and establish practical safeguards so that members can make safe choices and build relationships while being respected."

Outward growth without profitability; capital impairment amid three straight years of lossesSettlement halt triggers wave of criminal complaints; a platform ecosystem that has lost trustNormalization uncertain even after rehabilitation commences; structural crisis with no buyer in sight Balaan, once valued at 800 billion won and hailed as a 'unicorn' of Korea's luxury platform market, has finally entered court receivership. Its founder, CEO Choi Hyung-rok, is under police investigation over the recent failure to settle sales proceeds with vendors and has been placed under a travel ban.According to industry sources on the 10th, after Balaan filed for corporate rehabilitation on the 31st of last month, the Seoul Rehabilitation Court decided on the 4th to commence proceedings and, without appointing a separate outside custodian, designated CEO Choi Hyung-rok as the custodian. He has thus taken on the dual task of submitting a rehabilitation plan and responding to the criminal investigation at the same time.Choi, a former Air Force accounting officer, founded Balaan in 2015 right after his discharge. Starting out as a C2C platform model connecting luxury sellers with consumers, Balaan grew rapidly during the COVID-19 period on the back of rising consumption and demand for contactless services.Annual revenue grew from 24.3 billion won in 2020 to 89.1 billion won in 2022. Choi then propelled Balaan into the ranks of the 'world's No. 3 luxury platform' through aggressive marketing and fundraising strategies.Behind the outward growth, however, lay a structural lack of profitability. Balaan has not posted a profit in a single year since 2020. In 2022 in particular, its annual net loss reached 37.4 billion won, and losses continued in 2023 at 12.3 billion won.At the end of 2023, the company fell into complete capital impairment, with total assets of 7.6 billion won and total liabilities of 15.3 billion won, leaving total equity at minus 7.7 billion won. Current assets amounted to only about 5.6 billion won, while current liabilities stood at roughly 13.8 billion won, a short-term liquidity shortfall of 8.2 billion won. Structurally, it was effectively impossible to settle with sellers or cover operating expenses without an inflow of outside funds.The financial situation was serious enough that the audit report explicitly stated that 'total liabilities exceed total assets, raising significant uncertainty about the company's ability to continue as a going concern.'Nevertheless, Balaan focused on expanding its scale, spending roughly 69.1 billion won on advertising over the three years from 2021. It poured 30 to 40 percent of annual revenue into marketing, but never built a revenue base to offset it.Internal controls were also inadequate. With improvements to the seller settlement system repeatedly deferred, operations continued until last month's failure to pay sales proceeds. Balaan halted settlements on March 24 and stopped product transactions altogether on the 28th.Once the situation became official, some vendors filed criminal complaints against Choi on charges of fraud and embezzlement. More than 20 complaints have reportedly been filed so far. The vendors claim that "after the TMON and WeMakePrice cases, Balaan promised to bring in a settlement agent, but never kept that promise."In particular, because the company was still pushing vendors to sign up for advertising products right up until settlements stopped, suspicions have been raised that this was a planned deferral of settlements rather than a simple mistake. Police have accordingly placed Choi under a travel ban and launched a full investigation.Damage to trust with investors has also become unavoidable. On February 28, Balaan secured a convertible bond (CB) investment totaling 15 billion won from KOSDAQ-listed Silicon2. The first tranche of 7.5 billion won was paid in, with the remainder to be disbursed once Balaan met certain conditions.But when the rehabilitation filing came to light, Silicon2 could not hide its dismay, saying it "had not been informed of the matter in advance." The 50 percent stake it secured through a call option is now increasingly likely to lose its practical value as the rehabilitation proceedings progress.With the court's decision to commence rehabilitation proceedings, Balaan's debts have been temporarily frozen. As a result, most of the settlement receivables held by sellers are classified as general unsecured claims and may rank low in repayment priority. Industry analysts believe the recovery rate is likely to fall below 10 percent. For this reason, some sellers are shifting strategy toward pursuing personal liability through criminal complaints in addition to civil suits.At present, Balaan's prospects for rehabilitation are unclear. No company has so far expressed an intent to acquire it. Given the combination of impairments, including damage to the brand's image, financial risk and settlement debts, the likelihood of a strategic investor (SI) or financial investor (FI) stepping in is also rated as low. The deadline for submitting the rehabilitation plan is June 27. Even if a plan is submitted, it is uncertain whether the court will approve it. In particular, with self-rehabilitation looking difficult, the possibility that the case will be converted to bankruptcy proceedings if no buyer is secured cannot be ruled out.Immediately after the filing, CEO Choi Hyung-rok said, "We are keeping every option open to resolve the settlement problem and normalize our service." But given that the platform industry runs on trust, the consensus in the industry is that trust once lost is not easily regained. That is why analysts increasingly believe Balaan's rehabilitation will be difficult unless it secures accounting-based transparency, normalizes its capital structure and repairs its relationships with sellers, all at once.Attorney Shin Dong-woo of DAEON Law Firm pointed out, "Once rehabilitation proceedings begin, sellers, as general unsecured creditors, will inevitably be pushed down the repayment priority, so their actual recovery rate is very likely to be extremely low," adding, "For small and mid-sized sellers in particular, whose settlement payments fed directly into revenue and operating funds, the rehabilitation could itself lead to a liquidity crisis."He added, "Ultimately, the essence of a platform business is trust, and with that trust shattered, it is hard to expect the business to normalize through legal rehabilitation alone. Rebuilding trust when investors, sellers and consumers have all walked away is, in effect, starting over from scratch."

Plunging sales and complete capital impairment; rehabilitation plan hinges on 'securing a buyer'Vendors push back as settlement receivables are frozen; moves toward collective actionInvestors blindsided by rehabilitation filing; Silicon2 says 'nothing was shared' Online luxury platform Balaan has finally entered corporate rehabilitation proceedings.According to industry sources on the 1st, Balaan CEO Choi Hyung-rok had denied rumors that the company was pursuing rehabilitation, but on the 31st of last month he finally admitted to the filing in an official statement. The company formalized the rehabilitation just four days after a related document leaked on the 26th and stirred controversy. Months of unpaid settlements to partner vendors culminated in a loss of trust and a liquidity crisis, leading to court receivership.Alongside the rehabilitation filing, Balaan said it would seek to normalize its business through a merger and acquisition (M&A). "We will pursue an M&A with the business continuity of our vendors as the top priority," CEO Choi said.Inside and outside the market, however, critics say both rehabilitation and an acquisition have little chance of becoming reality.Given the accumulated debt, the damage to the brand's image and the backlash over unpaid settlements, the very precondition of the rehabilitation plan, 'securing a buyer,' is expected to run into obstacles from the outset.The company's finances have already reached their limit. Balaan's revenue in 2023 was 39.2 billion won, a 56 percent plunge from the previous year (89.1 billion won). Its total equity stood at minus 7.7 billion won, a state of complete capital impairment. Even so, last month Balaan signed a 15 billion won convertible bond (CB) investment agreement with KOSDAQ-listed Silicon2. The first tranche of 7.5 billion won was paid in, with the remaining 7.5 billion won to be disbursed on the fulfillment of certain conditions, such as the share of direct purchasing and the achievement of operating profit.But once the rehabilitation filing was formalized, Silicon2 could not hide its dismay, saying "nothing was shared with us in advance." Silicon2 holds a call option entitling it to acquire a 50 percent stake in Balaan, but concerns are being raised that the unpaid-settlement crisis could adversely affect the entire investment structure.Once rehabilitation proceedings commence, all debts are temporarily frozen. This includes the commercial receivables (settlement payments) held by vendors on the platform, and whether and how they are repaid is then determined according to the rehabilitation plan. Roughly 1,300 vendors are currently estimated to be on Balaan, and industry observers believe unpaid settlements could amount to tens of billions of won.The backlash from vendors is growing accordingly. In an open chat room of some 800 members, complaints poured in: "They told us to wait, and in the end they went into rehabilitation," and "Hundreds of millions of won in settlements are tied up, and recovery is practically impossible."Some vendors are moving toward collective legal action, including criminal complaints and civil suits against CEO Choi Hyung-rok. "I'd say the odds of getting our settlement money back are below 1 percent," said an official at one vendor.In legal circles, the prevailing view is that the rehabilitation proceedings will be hard to wrap up quickly. Attorney Shin Dong-woo of DAEON Law Firm noted, "As general unsecured creditors, the vendors rank low in repayment priority, so their actual recovery rate is likely to be low as well," adding, "Once rehabilitation begins, all claims are legally frozen, and for small and mid-sized vendors that were immediately recycling their settlement payments as cash, this could be a devastating blow to their liquidity."Experts stress that for Balaan's rehabilitation to succeed, it must not only secure a buyer but also fundamentally restore trust and normalize its financial structure. Skeptics, however, note that at this point few companies are likely to express an intent to acquire it.Suh Yong-gu, a professor of business administration at Sookmyung Women's University, said, "For a luxury platform, the core asset is not tangible property but intangible assets built on customers and data, and with the brand's image so badly damaged, the incentive to acquire it is low," adding, "At a time when even major offline retailers are struggling to sell, there will be almost no one willing to step up and acquire an intangible platform that is in rehabilitation."

Customers asking in Korean get 'English, please' in replyBrand frequently embroiled in racism and sexual harassment controversiesExperts warn of 'side effects such as instilling distorted values'  Brandy Melville's first store in Korea is drawing unfavorable looks from consumers. The brand, already under fire over allegations of racial discrimination, is insisting on 'English-only service' at its Korean store as well.According to industry sources on the 8th, at Brandy Melville's first Korean store in Seongsu-dong, Seoul, every employee serves customers in English. Ask a question in Korean and the answer that comes back is 'English, please.' Staff were also recruited through an English-language post on the brand's US Instagram account. This is understood to have targeted 'foreigners who can speak English.'The country options on Brandy Melville's website include English-speaking countries such as the United States, the United Kingdom and Australia, as well as Europe and Japan. But even selecting Japan displays the site in English, not Japanese.7e11e461551eae6ef5f2eee9c3b442a9_1737076539_2778.pngBrandy Melville was founded in the early 1980s by Italian-born Silvio Marsan together with his son Stephan. From the moment it opened, it has stirred up a range of issues, including selling only small sizes, racial discrimination, sexual harassment and design theft. With a company that caused so many problems in the United States now entering Korea and shunning the Korean language, resentment is building, centered on online communities.On top of that, Brandy Melville sells clothing in a single size: S (small). Since the brand makes clothes targeting only thin people, wearing Brandy Melville is also a way of signaling 'I am thin.' In the United States, one side effect was the emergence of teenage girls who developed anorexia while attempting the 'Brandy Melville challenge' (losing weight to fit into the tiny sizes).Racism controversies have also been unrelenting. According to a documentary by the US network HBO, executives demanded that female employees in their teens and 20s send not only full-body photos but photos of their feet and chests. Employees who were not slim were told they were being fired because they did not fit the brand's aesthetic. Employees of color were mainly assigned to departments without customer contact (such as stockroom work).Netizen A said, "This is a malicious company whose moral failings are so serious that a documentary was made overseas to expose them, so its entry into Korea is worrying," adding, "I'm concerned that young girls will be harmed by Brandy Melville."Netizen B criticized, "It's astonishing that a company doing business in Korea excludes Koreans and hires international students or working-holiday visitors from English-speaking countries," adding, "They've entered Korea with zero understanding of Korean sensibilities or language."Experts warn that Brandy Melville's entry into Korea could instill distorted values in Korean women in their teens and 20s. They point out that the perception that, even in Korea, only those who speak good English and are thin can wear the brand's clothes could stoke these young women's desire to show off and their vanity.Attorney Shin Dong-woo of DAEON Law Firm voiced concern: "In the United States, multiple sanctions and lawsuits concerning Brandy Melville are under way, but under current Korean law there is no suitable means of sanctioning this. Brandy Melville's policies could instill distorted values in consumers in their teens and 20s and cause a variety of side effects, so a brake is needed."While the vast majority of brands at home and abroad today pursue diversity in race, body type, gender and age, Brandy Melville clings to a 'young, thin, white' supremacism. Moreover, its haughty and brazen approach of shunning 'Korean' in Korea may inspire envy in some, but it is provoking resentment in most. Criticism keeps mounting that Brandy Melville, which is expanding into Asian countries including Korea, Japan, China and Singapore, needs to 'understand local sensibilities.'Newsway Reporter Yang Mi-jeong

Fraud and trading of prohibited items on the riseDanggeun Market shuts down phone support; replies take up to three daysJoonggonara effectively left unmanaged; trading of prohibited items still rampant #1. Mr. A, an office worker in his 30s, logged on to Danggeun Market last month to buy an electronic device priced at nearly 400,000 won. Spotting a listing offering a brand-new unit for a full 50,000 won less, he told the seller, Mr. B, that he wanted to buy it. Mr. B's 'manner temperature' was 60 degrees Celsius. When Mr. B, who had a solid transaction history and glowing reviews, pressed him, saying, "I'm already getting lots of inquiries; if you don't pay right now I'll move on to the next person in line," Mr. A immediately wired 350,000 won. But after saying only that he would bring the item over, Mr. B has since disappeared.#2. Ms. C, a homemaker in her 40s, was shocked to learn recently that her teenage child had bought e-cigarettes through Joonggonara. After stumbling on the cigarettes among the child's belongings and pressing them on where they came from, her child, D, answered, "I bought them on Joonggonara and had them shipped." When Ms. C logged on to Joonggonara and searched for 'cigarettes,' dozens of listings were already on sale or marked as sold.All manner of crimes are rampant on secondhand trading platforms such as Danggeun Market and Joonggonara. Critics say these platforms, however, are focused solely on bulking up while neglecting crime prevention, response and recurrence prevention.According to the Korea Internet & Security Agency on the 34th, the secondhand trading market, worth 4 trillion won in 2008, surpassed 24 trillion won in 2021 and is projected to surge to 43 trillion won this year. As transaction volume grows, crimes such as fraud have risen every year, reaching 100,000 cases last year. Adding in trades of prohibited items and crimes targeting minors, the figure is expected to climb even higher.Yet the secondhand platforms are leaving their flimsy operating systems as they are. Danggeun Market offers no phone support, so even when a user falls victim to a crime, there is no immediate response. It merely repeats the excuse that 'phone support involves cumbersome procedures for verifying member identity.' Inquiries submitted through the app can take up to three days to get a reply, and even that is currently suspended.Because secondhand trading has become a daily necessity, users say they have no choice but to keep using these platforms reluctantly, even knowing that crimes occur frequently. Danggeun Market, for its part, warns users who use harsh language toward a counterparty after a transaction goes wrong that, "separately from the transaction issue, you may receive a 'bad manners warning' or 'usage restriction.'"Danggeun Market user Kim Ye-eun said, "A little while ago I was scammed trying to buy a phone on Danggeun Market. I couldn't get any help from Danggeun at all, and when I reported it to the police, all I got was a reply that it is still being processed. I'd love to just delete the app, but with no real alternative, I can't even do that."A Danggeun Market official responded, "With 19 million monthly users posting an average of more than 15 million listings a month, it is realistically difficult to handle every inquiry by phone," adding, "We make our guidelines as easy and detailed as possible, and we use a modular response process and technology to quickly provide the solutions users need."The official continued, "We currently have a variety of safeguards in place to prevent fraud. In addition, even if a user who has been sanctioned signs up again with a different phone number, our internal system identifies them as the same person and immediately imposes usage restrictions," adding, "By combining technical measures with active cooperation with investigators, we will work to ensure there are no blind spots in user protection."On Joonggonara, the trading of prohibited items is a serious problem. Prohibited items such as medicines, alcohol and cigarettes can be found easily with a search, prompting criticism that the site is a blind spot for minors. Prohibited items are traded slyly through posts phrased as questions such as 'How do I use product XYZ?' The seller posts what looks like an informational question, discreetly adds contact information and steers readers toward a sale. Alcohol and cigarettes are also traded through listings that claim to be selling only the case.Under current law, alcohol and tobacco may not be traded online by individuals without a sales license. Violations are punishable by up to three years in prison or a fine of up to 30 million won. Yet countless users on Joonggonara are still selling and buying them. The fact that sales listings from days and even months ago remain up is evidence that Joonggonara has effectively left prohibited-item trading unchecked.Experts point out that as the scope of secondhand trading expands from cheap household goods to luxury items, apartments, cars and even part-time jobs, and as transaction values grow without limit, more proactive measures by these companies are urgently needed.Attorney Shin Dong-woo of DAEON Law Firm said, "Platform operators can also bear legal liability for criminal acts that occur during secondhand transactions on their platforms," adding, "If a platform operator fails to take appropriate safety measures to protect users or fails to fulfill its duty of management, it may be liable for damages, and in particular, if it knew of criminal activity and turned a blind eye, it could be found guilty of aiding and abetting."He stressed, "Platform operators must carry out appropriate measures or fulfill their duty of prevention to stop criminal acts taking place on their platforms." Newsway Reporter Yang Mi-jeong

How likely is punishment under current law?Deportation possible if deepfake allegations are confirmed Johnny Somali being taken away by police after causing a nuisance in Israel. Captured from X (formerly Twitter)Johnny Somali (real name Ramsey Khalid Ismael, 24), the American 'nuisance YouTuber' who drew public outrage with a string of bizarre antics in Korea, has finally apologized. With public sentiment souring sharply and police launching investigations into his various alleged offenses, he appears to have backed down out of fear of criminal punishment.According to broadcasting industry sources on the 9th, Somali said on the 7th, standing in front of the Statue of Peace in Dobong-gu, Seoul: "(Kissing the statue) was something I did for the entertainment of my American viewers. Seeing the reaction of Koreans, I realized they were offended. I had no intention of hurting your pride. I hope you will accept my apology." He repeated the apology in Korean as well, saying, "I was too young (and didn't know better). I am truly sorry."Though Somali has bowed his head, public opinion remains cold. The YouTube channel 'J Company_Politics & Current Affairs,' where the video was posted, was flooded with critical comments such as: "He apologized in Japan too before being deported, then moved on to another country and kept doing weird things," "What right do the Korean YouTubers who staged Somali's apology have to seek reconciliation on behalf of the victims?" and "Proceed with the investigation into Somali as planned and detain him right away."Police are in fact looking into Somali's various alleged offenses. He was booked on charges of obstruction of business after playing music and dancing in a convenience store in Mapo-gu, Seoul, on the 17th of last month and hurling profanities at an employee who tried to stop him. Mapo Police Station launched an investigation, imposing a travel ban and summoning him for questioning. He was spotted at Incheon International Airport on the 30th of the same month, raising suspicions that he was trying to flee the country, but the police travel ban means he will be staying in Korea for the time being.Somali is also accused of producing and distributing deepfake (AI-based image synthesis) pornography. On the 1st, he created a video of himself kissing Ms. A, a Korean female streamer active on the personal broadcasting platform Kick, and livestreamed it on his YouTube channel, after which Ms. A filed a complaint against him for violating the Act on Special Cases Concerning the Punishment of Sexual Crimes (distribution of false videos and the like). In the video he reportedly claimed to have had sex with Ms. A.If these allegations are proven true, he could face severe criminal punishment. Deepfake crimes are serious offenses that the National Assembly, the courts, the prosecution and the police have all recently vowed in unison to crack down on. Under Article 14-2 of the Act on Special Cases Concerning the Punishment of Sexual Crimes, producing a deepfake video is punishable by up to seven years in prison or a fine of up to 50 million won; if Ms. A's claims are correct, Somali could spend a considerable stretch of time behind bars in a Korean prison.Shin Dong-woo, Managing Partner at DAEON Law Firm, told the Kukmin Ilbo by phone: "Under current law, a foreigner who commits a crime in Korea is subject to the same statutes as a Korean national. As for the charge of obstructing the convenience store employee's business, the harm was minor, so I think it may end with something like a fine. But in the case of distributing a deepfake video, if the allegation is true, it will be difficult for him to avoid severe criminal punishment."If Somali did in fact produce the deepfake video and is criminally punished, he could be deported after serving his sentence. Under current law, if a foreigner residing in Korea receives a criminal punishment of a fine of 3 million won or more in a single case, or if the total fines paid over five years exceed 5 million won, the Ministry of Justice may decide after review whether to deport them. Distributing a deepfake video is a serious crime that far exceeds this threshold.Some observers note, however, that actual deportation is another matter. "Looking at Somali's track record, it seems quite likely that he will receive a criminal punishment exceeding the requirements for deporting a foreigner under current law," said one attorney who asked not to be named. "But because deportation also requires considering diplomatic relations with the other country, the government does not automatically decide to expel someone just because the requirements are met. There is room for the judicial authorities and the government to reach different judgments."Reporter Kim Jin-wook reality@kmib.co.kr

[Anchor]A recently introduced bill that would make recording a phone call without the other party's consent punishable by up to 10 years in prison is stirring controversy.Users who need phones with call-recording features for their work have pushed back, asking whom the law is meant to serve.Reporter Yang Mi-jeong reports.[Reporter]An amendment to the Protection of Communications Secrets Act was recently introduced in the National Assembly.The bill stipulates that recording a phone call without the other party's consent could be punished by up to 10 years in prison.Its core is a new clause added to the current law stating that 'a participant in a conversation may not record the conversation without the consent of all other parties to it.'Rep. Yoon Sang-hyun of the People Power Party, who sponsored the amendment on the 18th, explained its purpose: "Call recording is sometimes a means of self-defense for the vulnerable, but it is often abused as a tool of intimidation," adding that "because it can infringe on the right to privacy and personal rights, it should not be permitted indiscriminately."Public opinion on the bill, however, has been nothing but frosty.The backlash is especially fierce among users who have stuck with Samsung Galaxy phones and the like because call recording is essential to their work.Their position is that if Galaxy's 'automatically record all calls' feature, a key point of difference from the iPhone, disappears, there is no longer any reason to use a Galaxy phone.If the bill passes, the domestic smartphone industry is also expected to take a hit.[Interview (by phone): Mr. A / Samsung smartphone user]- "I absolutely have to record calls because of my work. The biggest reason I use a Galaxy is automatic call recording, and if that becomes illegal, there's no reason to insist on a Samsung phone. Ten years in prison just for recording a call? That's absurd."On top of that, the bill would wipe out the positive functions of call recording, such as public-interest whistleblowing, protection against false accusations and exposing workplace abuse, while also restricting the right to know and freedom of expression and potentially saddling people with unjust civil and criminal liability.While it is positive from the standpoint of privacy protection, there are effectively no safeguards against the many side effects that would follow.[Interview (by phone): Shin Dong-woo / Attorney]- "If this bill passes and recordings made for whistleblowing, such as exposing workplace abuse, or for public-interest reasons come to be treated as illegally obtained evidence, there will be many more cases in which it is difficult to establish the substantive truth. And because the penalty provision imposes only imprisonment, with no option of a fine, on the person who made the recording, major repercussions are expected."Until now, call recording has been a useful tool for preventing serious crimes such as voice phishing, fraud, intimidation and verbal abuse.Critics say more careful deliberation is needed so that this bill, introduced without national consensus, does not go down as a bad law.