Daegu police bust gang-linked network that distributed over 1,000 shell-company accounts to criminal groups

Daegu police have arrested dozens of suspects linked to a local organized crime group that set up shell companies and distributed more than 1,000 corporate bank accounts to criminal networks.

The Daegu Metropolitan Police Agency said Tuesday it had arrested 64 people — including the alleged ringleader, a suspect in their 40s — and detained 26 on charges of establishing 76 shell companies and opening and distributing 1,021 corporate accounts.

Forty-five of those arrested also face charges of organizing, joining or participating in a criminal organization. Four legal clerks and staff members who assisted in the company registration process were also arrested.

Operating out of an office in Daegu from October 2021 through January 2026, the group divided responsibilities among a ringleader, managers, recruiters, and field and office team leaders to carry out the scheme systematically.

The suspects secured the accounts by temporarily depositing seed capital to register companies, then immediately opening corporate bank accounts in those companies' names.

They then supplied the accounts to phishing and illegal gambling site operators, collecting a monthly fee of 3 million won ($2,210) per account, according to investigators.

To evade law enforcement, the group coached account holders on what false statements to make and prepared fake loan text messages as cover, pointing to a tightly managed operation.

Police found that 313 of the accounts had been used in phishing and gambling crimes, with a total of 24 trillion won flowing through the network.

Investigators seized 190 fraudulent bankbooks and 23 mobile phones used for account authentication, and obtained a pre-indictment asset preservation order covering 1.33 billion won in criminal proceeds.

A Daegu Metropolitan Police Agency official said the agency plans to expand its investigation into the flow of distributed funds and the criminal organizations that used the accounts.