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South Korean Police Take Down $32 Million Crypto Scam Operation

South Korean police have recently dismantled a large crypto scam operation that fleeced hundreds of victims out of a total of $32 million, or roughly 38 billion South Korean won.

Nine Crime Groups Responsible

According to investigators, the massive fraud scheme involved the activities of nine different groups of “violent gangsters.” Eight individuals believed to have run the various crypto fraud operations have been arrested, along with 79 accomplices.

Over 500 Victims Nationwide

A total of 572 people have been identified as victims of the scams so far, nationwide. Police say that members of the crime ring created fraudulent “crypto reading room” websites on popular chat apps like KakaoTalk and targeted South Korean chat app users, especially younger people.

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Scammers posing as investment experts promised guaranteed profits on various cryptocurrencies, unlisted stocks, gold, and overseas futures contracts to lure in investors, police revealed. Victims were then asked to deposit money with the promise of high returns that were supposedly guaranteed.

$1.9 Million in Assets Seized

Authorities were able to seize around $1.9 million worth of assets in raids related to the operation, including luxury cars and cash. Investigators describe the accomplices and many of the scam victims as younger people, specifically from the Millennial and Gen Z generations.

The crypto fraud ring had been operating since at least February 2022, according to police. In a related development, the trial of a suspected altcoin fraudster who allegedly scammed over a dozen investors out of $2.1 million has begun in the city of Gwangju.

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South Korea also plans to require high-ranking public officials to disclose cryptocurrency holdings starting next year, while authorities in the city of Busan aim to launch the world’s first city-run “digital assets” exchange in early 2024.

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