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South Korean Police Crack Down on Crypto Fraud Gang
South Korean police have made a significant breakthrough in a recent crypto fraud case, leading to the arrest of 19 individuals on fraud charges. The gang, operating through a social media “crypto reading room,” is alleged to have defrauded 308 investors of approximately $18.8 million.
Modus Operandi of the Fraud Gang
- The gang operated through an “open chat room,” possibly a crypto Telegram group or a KakaoTalk open chat, where they posed as crypto experts and ordinary investors.
- Members of the gang claimed to have made profits by following tips shared in the reading room, luring victims into their scheme.
- They enticed victims to download apps linked to fake crypto exchanges, where they manipulated victims into investing in unlisted coins.
Victims’ Experience and Police Response
Victims were initially led to believe they were making gains on their investments. However, when attempting to withdraw funds, they were asked to pay “withdrawal fees.” Upon refusal, the gang cut off communication, leaving victims at a loss.
The police, after the arrests, are actively pursuing the recovery of the stolen funds and have sought Interpol’s assistance in locating six suspects who are currently overseas.
Ringleader’s Tactics and Legal Implications
The gang’s ringleader employed coercive tactics, known as “pig-butchering,” to recruit individuals into the fraudulent scheme. This has raised concerns about the rise of fraudulent activities in open chat rooms, potentially leading to charges of fraud and organized crime for the perpetrators.
Recent similar incidents in Gwangju, where 28 individuals were arrested for defrauding crypto enthusiasts, highlight the growing need for vigilance in the crypto community.
Ian is a cryptocurrency enthusiast blending humor with professionalism. With an engineering background and a storyteller's heart, he simplifies the blockchain world with sharp analysis and a touch of wit. At Cryptowire, he brings his unique perspective to make digital financial innovation accessible to all.
