Series Index
Part 1 | Unpaid Corporate Transactions: Liability Behind the Veil
Part 2 | Trade Name Continuity and the Liability of a Successor
Part 3 | Directors’ Liability for Damages
Part 4 | The Person Behind the Company Name
Part 5 | The Limits of Self-Defense in Assault Cases
Part 6 | Criminal Settlement Money: How Much Is Appropriate?
By Hong Seung-kwon
Principal Attorney, PAN Law Firm (skh@law-pan.com)
It is common in criminal cases to see settlements reached between victims and offenders. A settlement refers to an arrangement in which the victim receives a certain sum of money from the offender and expresses an intention not to seek further punishment. The payment made by the offender in such circumstances is commonly referred to as criminal settlement money.
A settlement carries important implications for both parties. For offenders, whether a settlement is reached can significantly influence a prosecutor’s charging decision and the severity of sentencing imposed by the court. For victims, pursuing full compensation through civil litigation often requires substantial time and expense, making settlement within the criminal process a practical means of obtaining at least partial restitution.
Yet determining an appropriate settlement amount is far more difficult than many assume. The fundamental reason is that human suffering cannot truly be converted into monetary value. In cases involving assault, sexual crimes, or traffic accidents that inflict physical or psychological harm, there is no objective formula for measuring pain in financial terms. Medical expenses can, of course, be calculated, but the emotional and psychological suffering endured by victims often extends far beyond what treatment costs alone can address.
Victims may also find the very act of assigning a price to their suffering deeply uncomfortable. Accepting a certain amount of money can feel uncomfortably close to forgiving the offender, an idea that many understandably reject. As a result, victims often seek higher settlement amounts, while offenders frequently view such demands as excessive, leading to repeated confrontation.
The author has represented both victims and criminal suspects. Through experience on both sides, one reality has become clear: the gap in perspective regarding settlement money is often far greater than expected. In relatively common offenses such as traffic accidents or assault, settlements are frequently reached with relative ease. Yet there are also countless cases in which negotiations ultimately fail despite prolonged efforts.
This raises a practical issue worth examining. Offenders, after trial, receive punishment proportionate to their crimes, whether in the form of fines, suspended sentences, or imprisonment. If a settlement is reached, they generally receive lighter punishment than they otherwise would.
In less serious cases, fines are commonly imposed. However, paying settlement money does not result in a corresponding reduction in the court-imposed fine. A settlement is merely considered a favorable factor in sentencing; it is not directly deducted from the fine itself. Consequently, from the offender’s perspective, reaching a settlement may prove economically more burdensome than declining a settlement and simply paying the fine.
When settlement demands become excessively high, offenders may conclude that paying a larger fine—or even accepting a suspended sentence or imprisonment—is the preferable course. This is particularly true for those facing financial hardship.
Of course, settlement remains entirely the victim’s choice, and that choice deserves respect. In many cases, a victim may find greater solace in seeking stricter punishment rather than a settlement. Nonetheless, victims who seek compensation through settlement may wish to consider these practical realities. If settlement demands are set too high and negotiations collapse, victims may ultimately be forced to pursue compensation through separate legal procedures, consuming additional time and emotional energy in the process.
Ultimately, there is no universally correct answer when it comes to criminal settlement money. What may serve as a reasonable starting point, however, is for both victims and offenders to step back from emotional judgment and carefully assess, with clear eyes, the consequences each side may face if settlement negotiations fail.
About the Author
Hong Seung-kwon is the managing attorney of Pan Law Office. His practice covers a broad range of issues, including civil and criminal litigation as well as emerging legal challenges in the digital era. He has continued to analyze how technological innovation, property rights, and regulatory policy changes affect legal and market structures.
