Crypto Fraud Reports in South Korea Surged Over 41% in 2020, Says Financial Watchdog

Although bitcoin prices fell over the weekend, the overall bull market remains in place, as does the crypto scam in South Korea. Recent data from the national financial regulator shows that the number of such incidents continues to rise.

Police set up special unit to investigate crypto currency fraud

According to Asia Kyungjae, the Financial Supervisory Service (FSS) revealed that reports of cryptocurrency fraud are increasing by more than 41.6 percent annually.

FSS statistics for January-October 2020 show a 41.6% increase in 555 suspicious transactions.

Following a significant increase in cases, police have promised to step up their efforts to crack down on cryptocurrency scammers across the country. The authorities have even set up a special investigation unit within the financial crimes department of the provincial offices.

The agencies involved in the investigation of cryptocurrency fraud are the Financial Services Commission, the Financial Supervisory Authority, the Government Affairs Coordination Office, the Ministry of Justice, the Public Prosecution Service and the National Police Agency.

South Korean fraudster pleads guilty to $16 million fraud

In addition, Yonhap reported another case of fraud in South Korea involving cryptocurrency scams by millionaires. The court called Lee a crook when he was sentenced to six years in prison. He was convicted of setting up a scheme to defraud about 1,300 people in just seven months.

Prosecutors say he stole about $16 million in crypto money from victims. Judge Cho Sangmin revealed the details of the case:

The defendant led the victims to believe that they could make a large profit in a short period of time and sold a virtual currency issued by an elusive Chinese company.

Lee set up his fraudulent scheme between October 2018 and May 2019, luring investors by saying: If you buy a cryptocurrency sold by a Chinese parent company, you can make a big profit.

However, the scammer became even more suspicious when he claimed that the Chinese company he is promoting is a solid company with a history of 30 years and 500 trillion won and plans to enter the electric car industry with an investment of 4 trillion won.

In addition, the court sentenced two of Lee’s accomplices to 18 months and eight months in prison for their involvement in the crypto-fraud ring.

What do you think about the increase in reported cases of crypto fraud in South Korea? Let us know your comments in the section below.

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