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Mergeplus ordered to compensate victims over Mergepoint app refund chaos

By Lee Jung-youn

Published : Sept. 1, 2023 - 17:25

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(Yonhap) (Yonhap)

Seoul Central District Court ruled on Friday that Mergeplus, the operator behind the problematic discount app, Mergepoint, must pay roughly 225 million won ($170,000) to 148 victims who had purchased unusable virtual coupons. The decision comes after a collective civil lawsuit identified the app's role in causing widespread refund chaos.

The court found Kwon Nam-hee, CEO of Mergeplus Corporation, and its affiliated companies responsible for the incident but absolved six online shopping sites that sold Mergepoint of liability.

The lawsuit was filed in September 2021 following a significant suspension of refunds by Mergepoint.

Mergepoint had attracted consumers by providing a discount service in which consumers could purchase Mergepoints and then use them to buy items at a 20 percent discount off regular price. The Mergepoints could be used in 60,000 places nationwide, including retail chains, convenience stores and coffee shops.

However, in August 2021, the operator suddenly announced that they would stop selling Mergepoints and reduce the retail chains that the virtual coupon could be used at, saying that they had been requested to register for the electronic financial business from government authorities.

Users demanded refunds and the authorities launched an investigation, which led to the trials of CEO Kwon and her younger brother, CSO Kwon Bo-goon, on several charges including fraud. The siblings were recently sentenced to four years and eight years in prison, respectively, in the second trial held in June.

Mergepoint buyers' total financial damages are estimated to reach about 75.1 billion won.