The government is pursuing the introduction of a system that pays rewards to people who report illegal online loan advertisements. The use of undercover investigations in the process of probing illegal private lending has also been placed on the review list.

The government held a pan-government task force (TF) meeting on the 2th to eradicate illegal private lending and decided to pursue additional institutional improvements centered on blocking illegal online advertisements, strengthening investigations, and expanding victim reporting.

■ Ad pre-screening to be expanded to all online lending advertisements

The government will first expand the scope of pre-screening for online lending advertisements. It plans to expand the targets of the ad pre-screening system, currently operated voluntarily by the Korea Loan Finance Association, to cover all online lending advertisements, and to verify whether the companies placing the ads are properly registered businesses.

■ Introduction of a reward system for 'illegal lending ad paparazzi'

A reward system will also be introduced to increase reports of illegal advertisements. The government plans to establish a so-called 'illegal lending ad paparazzi' system under which people who discover and report illegal lending advertisements online can receive rewards according to certain criteria. Through this, the government expects to detect and block illegal loan advertisements spreading through online channels, social networking services (SNS), and various platforms at an early stage.

■ Review of undercover investigations... Considering difficulties in accessing criminal organizations

Changes to investigation methods are also being reviewed. Relevant agencies agreed to discuss whether undercover investigations, currently used in some criminal probes such as digital sex crimes and drug offenses, can be applied to illegal private lending crimes. The measure takes into account that illegal private lending is often carried out in an organized manner through online messengers, burner phones, and non-face-to-face transactions, making it difficult to access criminal organizations through existing methods alone.

■ Removing barriers that block victim reporting

Issues that prevent victims from reporting will also be addressed. The government judges that some victims are unable to report their damage because they were coerced by illegal private lenders into participating in illegal acts during the loan or repayment process, or because they fear other unlawful activities being exposed. Accordingly, the government will review measures to encourage victim reporting by preparing special reporting or voluntary surrender schemes with defined periods and requirements, following consultations with relevant agencies.

■ Strengthening platform responsibility... Implementation to be checked in the first half of next year

The responsibility of online platforms will also be strengthened. The government plans to operate a self-regulatory consultative body with platform operators in the fourth quarter of this year, and to check in the first half of next year whether self-regulation, including the blocking of illegal private lending advertisements, has actually been properly implemented.

The time from a victim receiving counseling to an actual investigation will also be reduced. The government plans to deploy police personnel so that if criminal suspicion is confirmed during the Credit Counseling & Recovery Service's one-stop support process for illegal private lending victims, the case can be immediately connected to investigation. The aim is to reduce the inconvenience of having to visit a police station separately at the counseling stage or go through reporting procedures again, and to enable investigative agencies to respond immediately upon confirmation of the damage.

■ From post-facto detection to pre-emptive blocking... Some measures not yet finalized

The direction of these measures is to prevent the inflow of illegal private lending from the online advertising stage, and, where damage has already occurred, to swiftly connect reporting with investigation. In particular, with the illegal advertisement reporting reward system and the review of undercover investigations being pursued together, the likelihood has grown that enforcement will expand from the existing focus on post-facto detection to pre-emptive blocking and proactive investigation methods.

However, undercover investigations for illegal private lending and special victim reporting periods are not yet confirmed systems, but are at the review stage following consultations among relevant agencies. The scope of application is expected to be determined by future legal groundwork and detailed implementation plans.

The government plans to continuously check the implementation of illegal private lending countermeasures and, if additional institutional improvements are needed, to prepare response measures through the pan-government TF.

[The reward system for reporting illegal loan and lending advertisements, undercover investigations, and measures to encourage victim reporting may change in content through future consultations among relevant agencies and the institutional refinement process. In the event of damage, it is necessary to confirm the official reporting and counseling procedures of relevant agencies. AI assistance was used in writing and restructuring this article.]