Supreme Court: Rental income from prostitution venues is criminal proceeds; full forfeiture is justified

South Korea's Supreme Court has ruled that landlords who knowingly rent out properties for prostitution must forfeit all rental income, deeming it entirely criminal proceeds. The landmark decision came in a case involving a building owner, identified as A, who was sentenced to one year in prison, suspended for two years.

The court overturned the original sentence, sending the case back to the Seoul Central District Court. A had acquired a motel and its land in Seoul's Gwanak District in 2017, inheriting an existing lease agreement with a tenant, B. Records show that tenant B had a history of being caught for facilitating prostitution.

Despite the previous penalties against B, A continued to lease the property. B signed another lease agreement in 2019 using a spouse's name and extended the lease in January 2021. A received rental payments from July 2019 to October 2022.

The Supreme Court's decision emphasizes a stricter stance against property owners who facilitate illegal activities. By classifying all rental income as criminal proceeds in such cases, the ruling aims to deter landlords from profiting from prostitution and other illicit businesses.