"High Returns After Listing" Coin Scam Alert... "Ongoing Illegal Similar Deposit Damage Occurs"

The Financial Supervisory Service (FSS) announced on the 13th that cases of fraud involving inducing investment in virtual assets with the lure of high returns after listing and then embezzling funds are continuously occurring, urging special caution.

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According to the FSS, recently, illegal pyramid scheme fraud damages have been continuously occurring where investors are induced to invest by claiming that investing in a specific coin can yield tens to hundreds of times high returns after listing, and then funds are embezzled. In the first quarter of this year, the number of damage consultations and reports related to virtual asset investment disguised pyramid schemes handled by the FSS recorded 59 cases, a 47.% increase compared to the same period last year. The FSS expects that illegal pyramid scheme operators exploiting the recent rise in prices of major virtual assets such as Bitcoin will increase and strongly urges caution.

Illegal operators lure investors into one-on-one chat rooms by promoting promising coins invested in by major domestic conglomerates through finance-related YouTube channels. Then, for investors lacking funds, they encourage additional investment by taking out loans from secondary financial institutions under the pretext of 'leverage investment,' and it has been identified that they show false and manipulated price charts.

Furthermore, they induce sign-ups by claiming to have developed their own coin wallet site and deceive investors by making it appear as if virtual assets have been pre-paid before the investment deposit. They also impersonate employees of overseas virtual asset exchanges. Additionally, they present fake documents showing that the coin is scheduled to be listed on domestic virtual asset exchanges to deceive investors and provide false agreements promising to repurchase at the purchase price or a higher price in case of principal loss.

Victim A reported suffering a loss of about 10 million KRW after requesting a one-on-one consultation upon watching a YouTube video in December 2022 claiming, "This is a virtual asset directly developed and invested in by a major conglomerate, and over 400% high returns are possible." Deceived by phrases like 'low-price buying opportunity' and 'guaranteed high returns,' the victim deposited investment funds, but the illegal operator delayed withdrawals citing a lock-up period and eventually cut off contact.

The FSS emphasized, "If approached through YouTube, etc., claiming that coin investment can yield tens of times returns, it is highly likely to be an illegal pyramid scheme fraud, so caution is necessary," and added, "If you are asked to take out additional loans beyond your own funds to invest or to provide personal information, you must refuse unconditionally."

They also added, "Do not be swayed by business cards of overseas exchange employees or claims that the coin is invested in by a major domestic conglomerate, and make decisions carefully," and "Before investing in coins, always verify with the relevant exchange whether a specific coin is listed on domestic virtual asset exchanges, and if suspected of being an illegal pyramid scheme operator, report promptly."

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