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ACT ON THE REGULATION OF CONDUCTING FUND-RAISING BUSINESS WITHOUT PERMISSION

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ACT ON THE REGULATION OF CONDUCTING FUND-RAISING BUSINESS WITHOUT PERMISSION

Act No. 6105, Jan. 12, 2000

Article 1 (Purpose)

The purpose of this Act is to regulate any fund-raising business conducted without permission in order to protect good traders and establish a sound financial order.

Article 2 (Definition)

The term "fund-raising business without permission" used in this Act means any business falling under any one of the following subparagraphs that is performed to raise funds from unspecified individuals without obtaining authorization or permission or making a registration or report, etc. under other Acts and subordinate statutes:

1. The business of receiving any investment under an agreement to pay the whole of such investment or an amount exceeding such investment in the future;

2. The business of receiving money on the pretext of savings, installment savings, installments, deposits, etc. under an agreement to pay the whole of the principal thereof or an amount exceeding such principal in the future;

3. The business of issuing or selling debentures under an agreement to repurchase such debentures above the price of such issuance or sale in the future; and

4. The business of receiving money on the pretext of membership fees, etc. under an agreement to compensate for any future economic loss with cash or securities.

Article 3 (Prohibition on Fund-Raising Business without Permission) ACT ON THE REGULATION OF CONDUCTING FUND-RAISING BUSINESS WITHOUT PERMISSION

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No person shall carry on any fund-raising business without permission. Article 4 (Prohibition on Indication or Advertisement of Fund-Raising Business without Permission)

No person shall make any indication or advertisement (referring to any indication or advertisement under the Act on Fair Indication and Advertisement) on his/her business for unspecified individuals with a view to carrying on any fund-raising business without permission. Article 5 (Prohibition against Use of Trade Name Similar to Financial Business)

No person shall use any name, as prescribed by the Presidential Decree, recognizable as a financial business in his/her trade name for the purposes of performing any fund-raising business without permission. Article 6 (Penal Provisions)

(1) Any person who violates Article 3 shall be punishable by imprisonment of not more than five years or by a fine not exceeding fifty million won. (2) Any person who violates Article 4 shall be punishable by imprisonment of not more than two years or by a fine not exceeding twenty million won. (3) Any person who violates Article 5 shall be punishable by imprisonment of not more than one year or by a fine not exceeding ten million won. Article 7 (Joint Penal Provisions)

If the representative of a juristic person, or the agent, employee or any other employed person of a juristic person or an individual has committed a violating act under Article 6 in connection with the business of the said juristic person or individual, not only shall such an offender be punished accordingly, but the juristic person or individual shall be punished by a fine as prescribed in the said Article.

ADDENDUM

This Act shall enter into force on the date of its promulgation.