South Korean authorities have dismantled a large-scale cryptocurrency investment scam that deceived over 15,000 people, including many older and vulnerable investors, resulting in losses totalling 325 billion won (approximately $230 million).
The Gyeonggi Southern Provincial Police Agency’s Anti-Corruption and Economic Crime Investigation Unit has arrested 215 individuals involved in the scheme, with 12 identified as key organisers.
Those detained face charges under South Korea’s Aggravated Punishment Act for Specific Economic Crimes.
At the centre of the operation is the alleged ringleader, known only as “Mr. A,” a popular YouTuber with over 620,000 subscribers. Mr. A reportedly used his platform to lure followers with promises of quick and substantial returns, enticing some to go as far as selling their homes or taking out loans to invest in cryptocurrencies, allegedly guaranteeing returns of “20 times the principal.”
Operating from December 2021 to March 2023, the scam offered 28 types of cryptocurrency tokens, six of which were self-created and listed on overseas exchanges to attract buyers.
Sales agents, posing as investment experts, manipulated the token values to attract investors and persuaded victims to commit significant sums. Many of the affected investors were middle-aged and elderly, some losing their life savings.
The scam also involved misuse of personal information, with victims’ data used to impersonate officials from the Financial Supervisory Service. This allowed scammers to collect IDs and obtain loans under the guise of legitimacy.
Authorities traced the group’s funds through 1,444 bank accounts, eventually locating Mr. A in Australia after he fled South Korea via Hong Kong and Singapore.
Police seized 22 Bitcoins, valued at $1.9 million, and requested court approval to confiscate an additional $34 million tied to the scam.
The investigation remains ongoing, as South Korean authorities work to recover the funds and implement further protections against financial crimes targeting vulnerable populations.
