Prominent South Korean Financial Influencer Arrested in Country’s Largest Cryptocurrency Scam

A well-known financial influencer in South Korea, referred to only as Mr. A, has been implicated in what authorities are calling the country’s largest cryptocurrency fraud scheme, resulting in losses for investors totaling approximately $232.7 million.

Mr. A, who ran both an investment advisory firm and a popular YouTube channel boasting 620,000 subscribers, reportedly fled to Australia following the scandal but has since been apprehended. The scheme, which led to the arrest of 215 individuals, has left 12 of those suspects still in custody, according to the Yonhap News Agency.

Authorities believe that the scam began after Mr. A faced mounting refund requests from clients due to underperforming stock recommendations in 2020. In an alleged attempt to recover losses, Mr. A is said to have created a network of fake companies and launched a massive investment scheme involving 28 different cryptocurrencies between December 2021 and March 2023.

The Gyeonggi South Police Agency’s Anti-Corruption and Economic Crimes Investigation Team has revealed that Mr. A and his associates reportedly amassed 325.6 billion Korean won (approximately $232.7 million) from a total of 15,304 investors. Six of the 28 cryptocurrencies were reportedly issued and manipulated by Mr. A’s group, while the remaining tokens were lesser-known and held little to no inherent value.

The scheme appears to have specifically targeted middle-aged and elderly investors, exploiting data obtained from Mr. A’s YouTube following and advertising campaigns. Through these avenues, the group gained access to 9 million phone numbers, using this extensive contact list to reach potential victims. In addition, some members of the group allegedly impersonated officials from South Korea’s Financial Supervisory Service to gain the trust of their targets. In certain cases, victims were even persuaded to sell their homes in order to invest, leading to severe financial losses and hardship.

Authorities have thus far seized 22 Bitcoin, valued at nearly $2 million, from Mr. A, while also pursuing an additional $34 million in cash held in associated accounts. As the investigation progresses, South Korean law enforcement is continuing to track assets linked to the fraud.

By fLEXI tEAM