The aunt, Phiangjai Kim, 37, had flown to Thailand after learning a warrant had been issued for her arrest, the Bangkok Post reported.
The commander of an anti-human trafficking police unit, Maj. Gen. Chawalit Sawaengphuet, said Kim pleaded innocence to the charges, claiming her 17-year-old niece had gone to South Korea willingly and with her parents' permission.
The teenager was employed only to give massages and was not engaged in prostitution, police said Phiangjai told them.
The teenager had claimed she went to Seoul to work in a restaurant but was forced to work as a prostitute 20 hours a day at a brothel masquerading as a traditional massage parlor.
Phiangjai faces five charges, including collusion to commit human trafficking and luring and forcing others into prostitution.
Another Thai woman, Thippawan Tempao, 26, and a Korean man, Chun Song-kuem, 36, also are charged in the crime.
Because of the differing accounts, Chawalit said the girl would be re-interviewed in the presence of a psychologist, social welfare worker and a prosecutor.
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