Home - Blockchain - 30 South Koreans Arrested in $8m Crypto Currency Fraud

James Carter

February 23, 2023

30 South Koreans Arrested in $8m Crypto Currency Fraud

As part of an investigation into a possible 8 million dollar cryptocurrency scam, the police in South Korea have arrested thirty different people. It would appear that the masterminds behind the scheme made investors “guaranteed profits” of up to 2,000%.

According to a report in the Munhwa Ilbo, the Seoul Metropolitan Police estimate that the “gang” was successful in defrauding over 160 victims out of a total of $8 million. The authorities believe that the gang might have produced a coin and might be members of the governing foundation for the token. After that, the organization allegedly employed complex strategies in order to exert influence over the values of tokens once the cryptocurrency was listed on a major domestic exchange.

The Financial Crimes Investigative Unit of the capital claimed that it has turned over all 30 persons to the prosecuting authorities.

According to information provided by the unit, the operation was concentrated around “crypto reading room” channels on the messaging app Telegram. Between September and November of 2021, according to the police, the gang made an attempt to manipulate the prices of an undisclosed listed coin.

“Crypto Scam” Operators in South Korea, according to South Korean Authorities, Offered “500%-2,000% Profits.”
The criminal organization persuaded its victims to pool their money so that it could make a huge coin purchase in an effort to artificially inflate coin prices. However, when prices increased, the gang reportedly sold the coins for a significant profit, but none of the money was returned to the people who had been victimized by them.

According to the police, the criminal organization persuaded the victims that they might anticipate profits on their investments ranging from “up to 500% to 2,000%.”

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According to the officers, they were able to freeze a number of cryptocurrency exchange wallets and seize over one million dollars worth of cash.

The news outlet also reported that the authorities had disclosed their intention to form a “consultative body” together with cryptocurrency exchanges. Officers feel that having access to such a body will allow them to initiate investigations into cases of alleged cryptocurrency price manipulation more quickly.

TerraUSD, on the other hand, was based on algorithms and used code to keep its price stable at approximately one US dollar.

Many investors saw their life savings evaporate when Luna and Terra went into a death spiral. As a result, South Korean authorities have initiated various criminal investigations regarding the crash.

Towards the beginning of this month, the Chief Executive Officer of a fraudulent cryptocurrency bank in South Korea was sentenced to ten years in prison after a judge found him guilty of scamming investors out of approximately $181 million.