'Arrest of Investment Fraud Group Embezzling 19.5 Billion Won by Inflating Unlisted Stocks 180 Times'

A group involved in an investment scam that inflated the price of unlisted stocks up to 180 times their original value and embezzled a total of 19.5 billion KRW has been apprehended by the police.

On the 29th, the Mapo Police Station in Seoul announced that they had arrested 23 members of the investment scam ring on charges including organizing a criminal group, violation of the Specific Economic Crimes Act, and violation of the Capital Markets Act, and that four of them had been detained.

The investment scam group is accused of using the personal information of victims who joined a stock reading chatroom operated by the ringleader Mr. A, who impersonated an investment expert, from August 2021. They deceived victims by selling unlisted stocks with a face value of 100 KRW per share as high-yield investment products at prices inflated up to 218,000 KRW per share, which is up to 180 times the original price. So far, 756 victims have been identified, and the embezzled amount has been confirmed to be 19.5 billion KRW.

Source: Mapo Police Station

They used the name of a phantom company called 'B Holdings' and established an organization with headquarters and branches (in Dobong-gu, Seoul, Bucheon-si, Gyeonggi Province, etc.) to divide roles, indicating a planned crime. The branches received corporate IR information and victims' personal data from the headquarters to carry out the crime and received 25% of the criminal proceeds.

There were also indications that they tried to evade investigation. They communicated via Telegram, an overseas-based messenger, and contacted victims using aliases and burner phones. They also received payments for unlisted stock sales through dummy bank accounts.

The police conducted raids on branch offices located in Dobong-gu, Seoul, and Bucheon-si, Gyeonggi Province, seizing 65 burner phones, 24 computer hard drives, and over 100 million KRW in cash found in a car trunk. Approximately 700 million KRW, part of the criminal proceeds, has been subject to seizure and preservation measures before prosecution, while the police continue to pursue the ringleader Mr. A and other accomplices.

The police stated, "Unapprehended members of the organization have recently been using a database containing victims' lists to impersonate the 'Loss Compensation Team' of investment advisory firms and induce virtual asset investments," adding, "As additional damages are occurring, special caution is required."

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