'Up to 4% Monthly Guaranteed Returns' Bait Raises 360 Billion Won... Police Arrest Financial Company CEO and Others

Received Investments from Over 5,000 People Through Nationwide Roadshow
Investor Briefings

According to the police, Mr. A, the CEO of a financial consulting firm, and others established the company around May 2018 and are accused of raising approximately 360 billion won from about 5,000 people through 12 regional subsidiaries using a multi-level marketing scheme until June last year.
Photo by Seoul Metropolitan Police Agency Violent Crime Investigation Unit

[Asia Economy Reporter Oh Gyumin] A group that traveled nationwide, luring investors with principal guarantees and monthly interest payments of up to 4%, and collected thousands of billions of won in investment funds, has been arrested by the police.

The Seoul Metropolitan Police Agency's Violent Crime Investigation Unit announced on the 31st that they have booked 161 people, including CEO A of a financial consulting firm, on charges of violating the Act on the Aggravated Punishment of Specific Economic Crimes (fraud) and the Act on the Regulation of Similar Credit Transactions, and have detained 8 of them. Additionally, the police confiscated and seized approximately 83.2 billion won worth of criminal proceeds, including real estate, stocks, and condominium memberships acquired by A and others with the criminal proceeds.

A and others are suspected of establishing the company around May 2018 and raising about 360 billion won from approximately 5,000 people through 12 regional subsidiaries using a multi-level marketing method until June last year.

According to the police, they held investment briefings several times a month across the country. In particular, A introduced himself as a "successful entrepreneur who gained assets worth thousands of billions of won by investing in bonds."

He explained that "if you invest in solar power companies, your principal is guaranteed and you receive 2-4% interest monthly," attracting investors, but police investigations confirmed that in reality, they paid principal and interest using a so-called "Ponzi scheme" method.

They each received commissions ranging from at least 1 billion to 9 billion won as rewards for recruiting members, and reportedly spent tens of millions of won monthly on luxury car lease fees and other expenses. Photo by Seoul Metropolitan Police Agency Violent Crime Investigation Unit

They received commissions ranging from at least 1 billion to 9 billion won each as rewards for recruiting members, purchasing luxury goods such as high-end watches, and spending tens of millions of won monthly on leasing luxury cars and paying rent for residences.

The police obtained intelligence on them in March last year and identified the scale of criminal proceeds through multiple searches and account analyses, detaining A in December of the same year. Subsequently, the investigation expanded, booking a total of 160 people including executives and recruiters, and detaining 7 more among them.

A police official urged, "Financial frauds using various forms of high-interest and high-yield schemes are rampant, riding the recent investment boom, so careful verification is necessary before investing."

This content was produced with the assistance of AI translation services.