Does money repaid as advance interest or fees reduce the sum defrauded? Supreme Court Decision 2017Do10601 on 'the whole of the property delivered'

Question

Article 347(1) of the Criminal Act punishes a person who, by deceiving another, receives delivery of property or obtains a property advantage, and Article 347(2) applies the same penalty where, by the same means, a third party is caused to receive the property or obtain the advantage. Where property is obtained by deception and part of the price is repaid under the name of advance interest, fees or the like, the question is what the sum defrauded is: the value of the property delivered less what was repaid, or the whole of the property delivered.

Decision 2017Do10601 (26 October 2017) answers that question on the defendant's appeal against a judgment of the Daegu High Court of 22 June 2017 (2016No31, 2017No141), which convicted him of, among other offences, violation of the Act on the Aggravated Punishment, etc. of Specific Economic Crimes (fraud). The defendant argued that the amount obtained had been measured too widely; the Supreme Court dismissed the appeal. The same judgment also rejected grounds on the Court of Appeal's omission of a determination and on whether the charged facts fell under paragraph 1 or paragraph 2 of Article 347, and those points are set out where they bear on the question.

Material to check

The statutes are Article 347 of the Criminal Act, paragraph 1 of which punishes deception into receiving delivery of property or obtaining a property advantage with imprisonment of up to 20 years or a fine of up to 50 million won, and paragraph 2 of which applies the same penalty where a third party is caused to receive the property or obtain the advantage. The decision also cites the Criminal Procedure Act: Article 364, under which the appellate court judges the matters in the grounds of appeal, may judge ex officio matters affecting the judgment, and sets aside the first-instance judgment and renders a new judgment where the appeal is well founded; Article 369, under which the appellate court's written judgment shall state its determinations on the grounds of appeal; and item 1 of Article 383, which allows a violation of the Constitution, statute, order or rule affecting the judgment as a ground of appeal. The decision records that the Court of Appeal applied Article 3(1)(i) of the Specific Economic Crimes Act to the fraud facts; the texts read for this brief do not give the text of that provision.

The decisions are this decision and the four it cites. Decision 95Do203 (24 March 1995) and Decision 2000Do1899 (7 July 2000) state that delivery of property by deception is itself the injury to the victim's property and at once completes the offence, so that payment of substantial consideration or the absence of loss in the victim's property as a whole does not affect it, and that where part of the consideration is paid the sum defrauded is the whole of the property delivered. Decision 2000Do1899 also defines the benefit amount in Article 3 of the Specific Economic Crimes Act as the gain of a single offence or the aggregate amount where a comprehensive single offence is established, not the sum of the gains of offences punishable as concurrence, and holds that where several victims are separately deceived, each victim's legal interest is independent, so a separate fraud offence arises for each victim. Decision 2005Do741 (29 April 2005) states that where charged fraud facts fall under Article 347(1) rather than Article 347(2), or the reverse, that circumstance does not affect the result of the judgment, because the two offences carry the same penalty. Decision 2005Do4177 (27 June 2006) states that where the appellate court examines ex officio a ground outside the grounds of appeal and sets aside the first-instance judgment and renders a new judgment, the grounds of appeal are taken to have been determined in that process, so no separate statement of them is needed.

Possible readings

Read with Decision 95Do203 and Decision 2000Do1899, Article 347(1) makes the delivery of the property by deception the injury to the victim's property, and the offence is complete as soon as that delivery happens. Restitution of what was obtained afterwards, or payment of substantial consideration at the time, does not affect the establishment of the offence. Where part of the price is handed back under the name of advance interest, fees or the like, the sum defrauded is therefore not the value of the property delivered less the amount returned but the whole of the property delivered.

Read with item 1 of Article 383 of the Criminal Procedure Act and Decision 2005Do741, a ground of appeal must be a violation of law affecting the judgment. The decision holds that where facts charged as fraud fall under Article 347(2) rather than Article 347(1), the difference is not a matter affecting the result of the judgment, because the two paragraphs carry the same penalty. A defendant who points only to that difference shows no ground for reversal.

Read with Articles 364 and 369 of the Criminal Procedure Act and Decision 2005Do4177, where the appellate court sets aside the first-instance judgment and renders a new judgment after examining ex officio a ground outside the grounds of appeal, the grounds of appeal are treated as determined within that process. The decision accordingly holds that the Court of Appeal's omission of a separate statement on the defendant's ground contesting his intent did not make the judgment unlawful.

What the decisions held

The Supreme Court held, on the amount obtained in fraud by obtaining property, that delivery of the property by deception is itself the injury to the victim's property and at once completes the offence, that later restitution and payment of substantial consideration do not affect the establishment of the offence, and that where part of the consideration is paid as advance interest or fees the sum defrauded is the whole of the property delivered from the victim rather than that value less the amount returned. Applying that rule, it examined the Court of Appeal's reasons against the lawfully admitted evidence, found that the Court of Appeal had reasoned on the correct rule, and held that there was no misapprehension of the law on the amount obtained under Article 3(1)(i) of the Specific Economic Crimes Act.

The Court of Appeal, in its judgment of 22 June 2017 (2016No31, 2017No141), had set aside the guilty portions of both the first first-instance judgment (Daegu District Court Seobu Support 2015Go-Hap46) and the second first-instance judgment (Daegu District Court Seobu Support 2016Go-Hap61, 72, 209, consolidated) on the grounds of consolidated trials and a partial amendment of the indictment and, after hearing argument, again fixed the sentence and rendered judgment, finding proved the facts of forgery of a public document, use of a forged public document, violation of the Specific Economic Crimes Act (fraud), forgery of a private document, use of a forged private document and fraud. On the defendant's other grounds the Supreme Court held that the omitted determination on his ground contesting his intent was not unlawful, that the difference between Article 347(1) and (2) did not affect the result of the judgment, and that his challenge to the finding of guilt merely disputed the Court of Appeal's choice of evidence and evaluation of its weight, which belong to the free assessment of the court of fact, in which it found no violation of logic or experience. It dismissed the appeal by unanimous opinion of Justices Park Sang-ook (presiding), Kim Yong-deok (reporting), Kim Shin and Park Jeong-hwa.

Points left open

The decision states the amount rule for the case where the sum handed back was paid as advance interest or fees. It does not say whether amounts repaid to the victim after the fact reduce the benefit taken into account at sentencing or for any purpose other than the establishment of the offence. Nor does it say whether the sum defrauded always coincides with the benefit amount in Article 3 of the Specific Economic Crimes Act: Decision 2000Do1899 fixes that benefit amount as the gain of a single offence or the aggregate where a comprehensive single offence is established, and holds that separately deceived victims give rise to separate fraud offences, and the decision applied Article 3(1)(i) without discussing the calculation.

The holding on paragraphs 1 and 2 of Article 347 rests on the two carrying the same penalty, and the decision does not address whether a difference between them could affect the result of a judgment in some other setting, for example where the charge is confined to one paragraph. As to the omitted determination, the holding is limited to the case where the appellate court sets aside the first-instance judgment and renders a new judgment after ex officio review; the decision does not state whether Article 369 of the Criminal Procedure Act requires a separate statement where the appellate court upholds the first-instance judgment or remits the case.

When to reconsider

We revisit this brief if Article 347 of the Criminal Act is amended so that paragraphs 1 and 2 carry different penalties, if a later Supreme Court decision holds that sums repaid to the victim reduce the sum defrauded or states how the benefit amount in Article 3 of the Specific Economic Crimes Act is computed in a case like this one, or if any later decision fixes the treatment of amounts repaid after the offence.

Statutes referred to

• 형사소송법 제364조, 제369조, 제383조
• 형법 제347조

Decisions referred to

• 대법원 2017. 10. 26. 선고 2017도10601 판결 · Decision ledger
• 대법원 2006. 6. 27. 선고 2005도4177 판결
• 대법원 1995. 3. 24. 선고 95도203 판결
• 대법원 2000. 7. 7. 선고 2000도1899 판결 · Decision ledger
• 대법원 2005. 4. 29. 선고 2005도741 판결

Verification status

The decision was read in full, the four articles it cites in their current text, and the four cited decisions in their published holdings and summaries, all at the National Law Information Center (law.go.kr) on 24 October 2026. The decision's holding on paragraphs 1 and 2 of Article 347 of the Criminal Act rests on the two carrying the same penalty, which the current text of the article confirms.