The Seoul Rehabilitation Court has enforced a rule of thumb that, from the 1st, it will not treat the loss as reimbursement if an individual who suffered a loss after investing in virtual currency and stocks enters the rehabilitation procedure. The personal rehabilitation system is a system in which the court reduces debt. Therefore, if an office worker or a resident of Seoul enters the personal rehabilitation process, the money lost by investing in stocks and virtual currency does not have to be repaid from July. The court seems to have made this decision when many people in their 20s and 30s who have invested in coins or stocks with debt for the last two or three years applied for personal rehabilitation due to the financial market crash this year.
According to the monthly report of the Supreme Court, the number of individual rehabilitation applications received at courts nationwide from January to May stood at 102,396, an increase of 4,308 from the same period last year (98,088). Therefore, the idea of the Seoul Rehabilitation Court to help the 2030 generations who suffer from investment losses recover their economic activities by adjusting the debts is understandable. However, in a situation where relief measures for small business owners in their 40s and 50s who have suffered business losses due to the spread of Corona do not work, the rules of practice that are favorable only to the 2030 generation may be contested for fairness. The special immunity system for debtors who have had a hard time making a living due to the corona virus was expanded in 2020, but only 48 cases were subject to immunity in the first half of last year.
It is evaluated that the judiciary preemptively sought solutions to the problem because the National Assembly neglected the livelihood of the people and was engrossed in politics. Nevertheless, it is desirable that the courts follow conservatively as they are in a position to ultimately judge the results of legislation and policy actions rather than being the subject of ‘active administration’. The court’s decision, which started with good intentions, can lead to moral hazard, promote ‘debt investment’, or cause problems such as equity with local coin and stock investors, and consistency of standards to be applied to self-employed people. The government and the National Assembly should quickly establish the standards for immunity.