South Korean YouTuber Arrested in Massive Crypto Fraud Scandal

Sophisticated Crypto Scam by South Korean YouTuber Dupes Thousands

A major cryptocurrency fraud scandal involving a popular YouTuber with 620,000 subscribers has come to light in South Korea, marking one of the largest coin investment scams to date. The Gyeonggi Southern Provincial Police Agency’s Anti-Corruption and Economic Crime Investigation Unit has arrested 215 individuals, detaining 12, including the ringleader, Mr. A, who is in his 40s. This case highlights the sophistication and scale of the operation that duped over 15,000 investors out of approximately 325.6 billion won (213 million USD).

Elaborate Scheme Involving Fake Investment Promises

Mr. A, who ran a pseudo-investment consulting firm, reportedly set up a complex network to facilitate the fraud:

• Creation of Six Consulting Firms and 10 Sales Corporations: These entities were organized under a holding company with 15 teams handling various roles, including coin issuance, price manipulation, and money laundering.

• Exaggerated Promises: Victims were lured with phrases like “20 times the principal” and “Sell your apartment and get a loan to buy coins,” which resonated with individuals desperate for high returns.

• Cold-Calling Millions: The group acquired over 9 million mobile phone numbers through YouTube ads and lectures, leveraging these contacts for investment solicitations.

Out of the 28 coins sold, six were self-issued and listed on overseas exchanges through brokers, with prices artificially inflated by internal purchases before being sold to investors. The other 22 coins, though not self-issued, had minimal trading volume and little value, compounding the deception.

Targeting Vulnerable Investors

This crypto scam primarily targeted middle-aged and older individuals, with some victims investing as much as 1.2 billion won each, often by selling their homes. The fraudulent scheme even included using stolen personal information, which was acquired under the guise of compensation procedures. The group impersonated regulatory bodies, such as the Financial Supervisory Service, using fake business cards and phones to obtain IDs and credit loans.

After fleeing to Australia via Hong Kong and Singapore, Mr. A was apprehended, and authorities confiscated 22 Bitcoins. The police have applied for pre-indictment confiscation of assets worth 47.8 billion won, traced through extensive account analysis involving 1,444 sales and virtual asset accounts.