A financial influencer in South Korea is alleged to have set up a huge cryptocurrency scam after dissatisfied investors wanted a refund for bad stock advice he had given. Police have arrested 215 people in connection with the alleged fraud.
Of the 215 people arrested, 12 remain in custody, South Korean news agency Yonhap reported. Those detained include the alleged ringleader of the scam, who was identified as the middle-aged head of an investment advisory company and YouTuber with 620,000 subscribers. He was referred to only as Mr. A. Mr. A fled to Australia but has now been arrested.
A scammy influencer thinks big
Mr. A started selling virtual assets after he made a bad stock recommendation in 2020 and clients demanded a refund. He allegedly set up an extensive network of sham companies to carry out the fraud. He and his accomplices are accused of receiving 325.6 billion won ($232.7 million) from 15,304 people for investment in 28 cryptocurrencies between December 2021 and March 2023.
Six of the 28 coins were issued by Mr. A and his team, who went on to manipulate the market for them. The other coins were little known and had little value, according to the Gyeonggi South Police Agency Anti-Corruption and Economic Crimes Investigation Team. Gyeonggi is the province that surrounds Seoul.
Related: South Korean police catch $4.1M crypto scam duo
The scammers had access to 9 million phone numbers collected from Mr. A’s YouTube channel and advertising. They used the data to promote the scam to new victims, who were often middle-aged or elderly, and even impersonated members of the Financial Supervisory Service.
Organizational chart of Mr.A’s fraudulent companies. Source: Yonhap
Victims paid $854,000 to participate in the scheme and were encouraged to sell their apartments to pay for it.
Twenty-two Bitcoin (BTC) have been confiscated from Mr. A, and police have applied to confiscate $34 million in cash from accounts associated with the scam.
Crypto scammers in South Korea face harsh consequences
According to Yonhap, this case is the biggest cryptocurrency fraud to take place in South Korea. The country has experienced…
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