The South Korean police arrested 12 suspects, including a well-known YouTuber, in connection with a $231 million cryptocurrency fraud involving more than 15,000 investors. This arrest is part of a larger investigation that initially led to the arrest of 215 people, with 12 being detained for their involvement in the scam.
The YouTuber, known as Mr. A, masterminded a scheme that defrauded 15,000 people of 325.6 billion won (approximately $231.5 million). The group attracted investors by selling 28 different virtual assets as part of an investment scheme between December 2021 and March 2023. Mr. A, who had 620,000 subscribers, created a pseudo-investment company, promising high returns through virtual asset sales.
These assets were used to raise funds to repay earlier members who lost money in a failed 2020 stock investment suggested by Mr. A. To support this scheme, Mr. A created six consulting firms, ten sales corporations, and 15 other companies under his company. These firms were divided into roles like management, coin issuance, price manipulation, database handling, coin sales, and money laundering.
The group claimed that investors could receive returns up to 20 times their initial investments. However, police investigations revealed that only six of the 28 virtual assets were created by Mr. A’s team. These were listed on international exchanges through brokers, where the group inflated prices by purchasing them internally before selling them to investors.
The remaining 22 tokens were not self-issued and had low trading volumes and limited market value. The investigation began in February 2023 after a local police report was filed, leading to a detailed analysis of 1,444 accounts to trace fund flows. Mr. A was apprehended in Australia, where 22 Bitcoin were also confiscated from him.
The police are now pursuing further asset recovery, with applications filed to reclaim 47.8 billion won, estimated at around $34 million.
