South Korean police have arrested 19 individuals in connection with a sophisticated crypto fraud operation that swindled 308 investors out of approximately $18.8 million, Tim Alper recently reported on CryptoNews. Allegedly, the fraudulent scheme was conducted through a social media “crypto reading room,” which authorities believe operated as a crypto Telegram group or a KakaoTalk open chat.
The Daegu Police Agency’s criminal task force, which announced the arrests on May 21, revealed that the gang posed as crypto experts and ordinary investors within the chat groups. These members falsely claimed to have achieved significant profits by following trading tips shared in the “reading room,” thereby luring unsuspecting investors.
Despite these arrests, at least six suspects remain at large and are believed to be overseas. The police have requested Interpol to issue red notices for these individuals, mandating international law enforcement to arrest them on sight.
The gang reportedly sent out invitation links to their open chat room, which was filled with members who falsely claimed to have earned substantial returns by following the advice posted there. The victims were then persuaded to download apps connected to fake crypto exchanges where they could trade unlisted coins. Initially, the victims were allowed to make small gains to build trust, prompting them to invest larger sums. However, when they attempted to withdraw their funds, they were asked to pay “withdrawal fees.” Upon refusal, the gang would sever all contact with the victims.
Additionally, the gang employed “pig-butchering” tactics for recruitment. The ringleader promised job opportunities in Myanmar to several individuals, only to steal their passports and phones upon arrival, forcing them to join the criminal operation.
In a related incident earlier this week, police in Gwangju arrested 28 people on suspicion of defrauding around 50 South Koreans out of $1.3 million in a separate crypto scam.
