South Korean Court Jails Three Members of ‘Crypto Scam Gang’

A South Korean court has sent three members of a crypto scam ring to prison after hearing that they stole some $416,000 from victims as part of a concerted campaign.

The newspaper Chosun Ilbo reported that a branch of the Busan District Court’s Criminal Division sent the ringleader of the operation to jail for four and half years.

The court found the trio guilty of fraud and violating the Act on the Aggravated Punishment of Specific Economic Crimes.

South Korean Court: More Crypto Scammers Jailed

The court heard that the ringleader was the CEO of an “investment” firm. This firm, said prosecutors, duped victims into thinking they would receive monthly payments worth 30% of their original stakes.

The presiding judge jailed two other officials (both unnamed for legal reasons). The judge jailed one for three and a half years, and the other for two years and six months.

Prosecutors explained that the CEO and the other two officials “established an investment company in a building in Busan in June 2019.”

The ring, the prosecution service explained, told would-be investors that they would “select and trade” holdings in around 1,000 “high-quality” altcoins on the investors’ behalf.

The coins, the group said, were “hand-picked” projects based in countries “all over the world.”

This method, they promised, would ensure that investors received monthly payments of 30% of their stakes.

However, the investors were advised to keep their funds on the gang’s “platform,” rather than make withdrawals.

Instead, the prosecution service continued, the group proceeded to embezzle a total of 610 million won.

Scammers Preyed on People Who Knew Nothing About Crypto, Say Prosecutors

The presiding judge stated during sentencing that the CEO and the two officials had “committed crimes by taking advantage of the victims’ lack of knowledge about [crypto] investment.” The judge added:

“The method and circumstances of the crime – deceiving investors by making promises about cryptoassets – were very deplorable.”

Earlier this month, South Korean prosecutors arrested a top crypto market maker on scam coin-related charges . The arrest comes amid reports of a rise in crypto-related fraud cases.

Last year, prosecutors revealed details of cases involving fraudsters who targeted crypto scam victims by posing as regulators.

In one case, a gang of scammers was accused of duping victims out of $22.7 million by requesting that the victims pay USDT 5,000 in “investigation fees.”