Chapter 21
CHAPTER 21
This was the second time a light shone from real estate.
The first time was from the building in Seongsu-dong. At that time, I was able to purchase the building from the opponent at a cheap price. Then does it mean the same thing this time?
He now had a rough idea of when the light shines in financial products including stocks. However, there were few comparison groups for real estate yet. So it was difficult to think definitively.
If it is red, it is clear that it will be beneficial to me. I need to watch this area carefully.
In what way will it be beneficial? He had to clarify that part first.
"Phew, the situation is not good."
Manager Jeong Min-jun said as he entered after finishing the call.
"Is it very bad?"
"Yes. It seems these guys built the houses aiming for Jeonse fraud from the beginning."
"From the beginning?"
"It is a common occurrence. It is called organized Jeonse fraud. The developer raises funds from PF (Project Financing), builds the buildings with that money, then sells them and receives loans to pull out as much money as possible."
The scale of Jeonse fraud has been growing day by day. Jeonse fraud, which was initially done by individuals failing in gap investment, has now become an organized crime and cases occurring on a large scale were common. This place right here was exactly that form.
"I looked into it a bit, and there was a plan to build a global theme park in this area originally. It seems they bought the land aiming for that time. But as the theme park fell through, they turned it into Jeonse fraud."
"In other words, they chose Jeonse fraud to reduce the loss they would suffer?"
"Correct. But a slightly strange part is that the original land owner was a private equity fund on the Chinese side. That side handed over the land to JS Global Construction. And JS bought that almost at full price."
It was certainly strange. Since the theme park fell through, the reason to buy that land at full price disappears. Unless they slashed the price, that is.
"There is a possibility that the private equity fund side provided the funds."
"Correct. Because a money line is absolutely necessary for such large-scale Jeonse fraud. Although a little more confirmation is needed, it is highly likely that funds from the private equity fund went in."
The rough outline was revealed. They bought the land aiming for the theme park, but when it didn't sell, they planned Jeonse fraud to recover the funds used to buy that land. Since private equity funds do not choose means to earn money, it was a sufficiently possible thing.
And in that process, my mother was sacrificed.
Mother's Jeonse deposit. And the point that the villa area is shining. Two reasons were sufficient parts for Gang-hyeon to move.
"Manager, perhaps isn't there a possibility that a theme park will come into this area again?"
"Do you mean an amusement park?"
"Yes. Whether it's the existing amusement park or I wonder if development will take place in another form."
"Hmm... I will try to look into that part."
"Thank you, I ask you earnestly."
"Yes. And I will find a way for your mother's Jeonse deposit."
"Thank you."
Since he knew the reason, it was time to find a solution.
Incheon Airport. Gang-hyeon came out to see off his mother.
"Son, are you really not going together?"
"Something urgent came up at the company suddenly. Please have a good time with aunts."
"Gang-hyeon, really thank you. Thanks to you, aunt is going overseas like this."
"I never dreamed you would treat us to a Europe tour."
Gang-hyeon decided to send his mother with his aunts since he couldn't go. Even with the urgent schedule, the aunts all welcomed it, and thanks to that, his mother could also board the plane with a happy face.
Since it's First Class, they will go comfortably.
He reserved First Class for his mother and aunts, and there were people to guide them exclusively when they arrived in Europe. Since there would be absolutely no inconvenient parts, his worry was relieved a bit.
Just in time, contact came from Manager Jeong.
"Yes, Manager."
"I will go to the office."
Gang-hyeon headed straight to Seoul in his car.
Manager Jeong Min-jun, met at the office, opened his mouth carefully.
"I looked into it a bit. They say a project is in progress in that area of Yeongjong-do, Incheon. I don't know exactly what project it is, but since Yeongjong-do was composed as a tourism complex in the first place, I think something similar to a theme park might come in."
"If that project succeeds, how will the value of that area change?"
"I don't know for sure, but it is highly likely to jump much higher than the current value. But since there are past cases too, keeping the possibility of failure open is..."
Manager Jeong Min-jun advised carefully. If he says it works 100 percent here! He has to take that responsibility. Although he knows Gang-hyeon is not such a person, still, it was the best policy to always speak carefully. However, Gang-hyeon was different.
The project definitely succeeds. That's why the light was emitting so intensely.
It wasn't easy for the value of a villa-dense area to rise. However, if a new project proceeds in that area, the story changes. To proceed with the project, land had to be purchased, and that value had no choice but to rise naturally. If knowing that, there was one thing he had to do.
"What should I do to purchase this entire area?"
"Excuse me? This entire area?"
"Yes. Purchasing villas one by one seems too inefficient."
"Mmm... certainly such a method is unreasonable. If I were to purchase this area, I think I would use one of two methods."
Manager Jeong Min-jun unfolded a map. It was a map showing that villa area of Yeongjong-do, and it was shining red in this map too.
"Currently, villas in this area are dispersed and held by several companies. There is a method to contact those companies and purchase. Anyway, since they are thinking of bankruptcy due to Jeonse fraud, you can purchase at a slightly cheap price."
Gang-hyeon could see the Yeongjong-do villa area shining in a pale color upon hearing the explanation. As if telling him that is not the correct answer.
"What is the other method?"
"Acquiring NPL. Simply put, it is acquiring non-performing loans. When developing that area, a large-scale PF was issued to the developer. This PF has currently changed to non-performing loans, and banks seem to be having a headache."
Large-scale Jeonse fraud wasn't a crime that only made common people cry. Banks also suffer damage, so it was bound to affect society overall.
The light became stronger.
Gang-hyeon, listening to Jeong Min-jun's second explanation, could see the light becoming intense on the map. Since there was such a phenomenon when purchasing the building too, he could derive the conclusion that this is the correct answer.
"However, if going with the second method, there is a problem."
"A problem?"
"Yes, even if buying the bonds, there is no way to collect them. Because this developer is highly likely to go bankrupt eventually."
"By developer, are you talking about JS Global?"
"Correct. But chances are big that they are not the substance."
Jeong Min-jun turned on the tablet PC. When executing the program, a governance structure in pyramid form appeared.
"The developer of the villas in this entire area is JS Global, but they suffered from financial difficulties so they had no way to roll funds of this degree."
"Then it means there is a place that provided these funds."
"Yes, I think perhaps a Chinese private equity fund is that place. Since Chinese funds have already entered domestic real estate a lot."
"Are you saying they planned all the Jeonse fraud?"
"Possibility is high. If so, what they want would be the bankruptcy of JS Global. Because then the fact that money was remitted to the private equity fund evaporates."
When Jeong Min-jun pressed the name of JS Global long, it disappeared.
"If bankrupting only this company, the responsibility for PF evaporates."
"And the private equity fund becomes free of responsibility?"
"Since they sucked up money upward without being revealed on the surface in the first place, they don't have to take responsibility."
It was structured complexly, but eventually, it was nothing more than cutting off the tail. However, he could see that this method was the correct answer. Because a light more intense than ever was shining in that governance structure.
"You said the method for me to purchase all real estate in this area is acquiring NPL. How can I purchase?"
"JS Global's corporate value will already be close to zero. If tracking the flow of funds while acquiring this company, we can find out the paper companies that actually hold the real estate."
"I can check everything in one place."
"Yes. The people listed as representatives of these paper companies are highly likely to be mostly related parties or those who handed over their names illegally. They will hand over shares at a giveaway price even to avoid legal responsibility."
Everything became clear. What he had to do first was to purchase bonds to pressure them before JS Global goes bankrupt.
"However, CEO, if you do this method, all responsibility for Jeonse deposits might come to you. And if there is no particular good news in this area, such a method returns as a big risk. If not solved properly, civil complaints, media, and even political circles might move."
Jeong Min-jun wondered at first if Gang-hyeon was unfolding such an operation tempted by the word project he mentioned. Since responsibility might return to him by chance, he stopped Gang-hyeon as carefully as possible. But Gang-hyeon said laughing.
"For some reason, I think this area will be developed. I have such a feeling."
"Feel...ing?"
"Yes. Even if it goes wrong, I have zero intention to ask responsibility to Manager Jeong or the company. I will continue trading normally in the future too. So, you don't have to worry too much."
Trying to invest hundreds of billions with a feeling. It was questionable what on earth this man was thinking.
"Rather than that, Manager Jeong, wouldn't you like to do this work with me? I want to entrust a formal request to Samil."
"Yes, understood. I will upload a report regarding the relevant agenda to the representative immediately and organize an M&A team."
At the trustworthy answer, Gang-hyeon smiled.
Oh Jeong-seok, CEO of JS Global Construction Inc., checked the date.
"Roughly everything will be finished this month."
He was currently in a state of preparing to organize the company. Preparation to launder held funds into coins and transfer overseas entered the final stage. What remained was to pull up all remaining funds spread in each paper company. Although considerable time was consumed to gather until the last grain, he could endure.
"If only I finish this work, I can return to my previous life."
When his father operated JS Global, the company did well. Making its name known as a mid-sized construction company, it proceeded with construction of quite a scale. However, after his father passed away, as he, the successor, came to operate the company, everything went awry.
"It's not my fault. Corona burst and raw material prices skyrocketed to the ceiling, what construction company can endure?"
The company became harder and harder and debt piled up. As the fancy life spent as a young master in the past became distant, stress became severe. In the meantime, an opportunity came, and Oh Jeong-seok took that opportunity risking danger. And now the work reached the final stage.
If I hide in Cambodia, even police guys won't be able to find me. I just have to live like a king there.
If entering that place where the Korean government cannot find easily, everything will be solved. It was when he was harboring hope that he could return to the past again.
"What is it?"
"Guest? Who?"
A name heard for the first time. To come without an appointment. There is no reason to meet.
"Bo...nd?"
What that meant was one thing.
"Tell him to come in."
A moment later. A man in his 30s in a neat suit was sitting in front of Oh Jeong-seok. He smiled and introduced himself to Oh Jeong-seok.
"I am Choi Gang-hyeon, CEO of KH Recovery."
(End of Chapter)
— Translated by Prime Works —