The Born Korea indicted over false 'wild shrimp' ad; CEO Baek cleared

The Born Korea and a staff member responsible for home shopping operations have been indicted on charges of false advertising after the company marketed a product containing farmed Vietnamese shrimp as "wild-caught shrimp." CEO Baek Jong-won was cleared of the same charges after prosecutors found no evidence he was involved in the advertisement.

The Seoul Central District Prosecutors' Office's Criminal Division 2 indicted The Born Korea and a home shopping staffer, identified only as A, from the company's retail business team on charges of violating the Act on Labeling and Advertising of Foods on Wednesday, without seeking their detention.

The Born Korea and A are accused of falsely advertising their "Deopjuk" product on SK Group's online shopping mall from June 2024 through March last year, posting descriptions that called the shrimp topping "wild-caught" when it was in fact farmed white-leg shrimp from Vietnam.

Prosecutors confirmed through import declaration documents and other records that the shrimp used in the product was farmed white-leg shrimp of Vietnamese origin.

SK Group's review team had asked The Born Korea to provide documentation proving the shrimp was wild-caught before the advertisement went live. The company failed to obtain such documentation but posted the advertisement unchanged regardless.

A's side denied intentional wrongdoing, claiming the "wild-caught shrimp" label had gone unnoticed during the rushed preparation of the home shopping broadcast. Prosecutors, however, concluded there was sufficient evidence to support the charges, noting that the company had been asked to verify the shrimp's origin before the ad was posted and had proceeded without doing so.

Under prosecutors' case-handling guidelines, such cases are subject to indictment when sales exceed 30 million won ($21,700). Sales of the Deopjuk product were found to be approximately 171.46 million won.

However, prosecutors declined to indict Baek on the same charges.

Police had initially decided not to refer Baek to prosecutors, finding no evidence he had conspired in the false advertisement, but the case was forwarded to prosecutors after the complainant filed an objection. Prosecutors requested a reinvestigation from police in December last year.

During the reinvestigation, police obtained internal company documents — including approval authority rules and work orders — and traced the ad's approval process. They found that a lower-ranking employee had handled final approval for the advertisement without Baek's sign-off, and no materials were found indicating Baek had approved or been aware of the ad's content. Prosecutors accepted the police's assessment and cleared Baek without indictment.

Meanwhile, prosecutors cleared The Born Korea and a social media staffer from the company's marketing team, identified only as B, of allegations that they had promoted a sweet potato bread product made with Chinese sweet potatoes as domestic agricultural produce.

The Born Korea and B had been accused of deceiving consumers by posting phrases such as "Our Value Project" and "Our produce, our Paik's Coffee" on the official Instagram account of the Paik's Coffee chain from January to March 2024 while advertising a sweet potato bread made with Chinese sweet potatoes.

During the investigation, B's side claimed that when resizing the product poster for Instagram, the country-of-origin label printed at the bottom of the poster had been cropped out, and that there had been no intent to conceal the origin.

Prosecutors determined it was difficult to establish intent to deceive consumers, citing several factors: the poster on The Born Korea's official website clearly stated the Chinese origin; physical posters with the same origin label were displayed in Paik's Coffee stores; and the Instagram post itself included a note indicating that the sweet potato bread was excluded from the "Our Value Project."

The investigations began last year after a complaint was filed through the government's public petition portal over the sweet potato bread advertisement and a separate complaint was filed with the Gangnam-gu district office over the Deopjuk advertisement. Police referred A, B and others to prosecutors in November last year while declining to refer Baek. After supplementary and reinvestigations, prosecutors indicted only The Born Korea and A, clearing the remaining suspects.