A South Korean individual in their 30s has been sentenced to seven years in prison for crypto fraud, according to Newsis and Segye Ilbo. The Suwon District Court handed down the sentence after hearing how the fraudster defrauded victims of approximately $2.2 million. The court revealed that the unnamed individual, known as “A” for legal purposes, deceived around 30 investors whom they met through acquaintances and mobile chat apps between January 2020 and February 2023.
The Scheme
The court learned that “A” convinced the victims to deposit cryptocurrency into a wallet by promising them significant gains in a short period of time. Additionally, “A” assured the investors that they would return the initial investment, along with bonus payments. However, when “A” failed to fulfill these promises, the victims filed complaints.
Prosecutors revealed that “A” had actually incurred heavy losses from investing the victims’ crypto. To make up for the losses, “A” resorted to taking out multiple loans and accumulated a significant amount of debt. The court concluded that “A” had no intention or ability to fulfill their promise of repaying the victims.
The Rise of Crypto Fraud in South Korean Chat Apps
The court also highlighted the prevalence of crypto fraud in South Korean chat apps, with fraudsters infiltrating or creating “crypto investment study groups” on platforms like KakaoTalk. Unfortunately, the court stated that the tokens invested by the victims were now irrevocably lost, leaving “A” with no means to compensate the victims.
The presiding judge noted that Suwon, a major city near Seoul, serves as the unofficial capital of the South Korean tech industry. The city hosts the headquarters of Samsung’s electronics division and numerous prominent IT industry players. However, Suwon has seen a surge in crypto fraud-related cases in recent years.
Earlier this month, a Suwon court sentenced a 70-year-old man for participating in a crypto-powered dating app-based fraud ring. Prosecutors in the city also brought charges against the CEO and Vice President of a crypto-powered “virtual fashion items” marketplace in May this year. It is estimated that the duo defrauded approximately 435 victims of around $333 million in crypto and fiat currencies.
