South Korean Police Bust Alleged ‘Fake Crypto Mining’ Scheme

South Korean authorities have cracked down on a suspected fraudulent scheme involving purported crypto mining operations, particularly targeting Cardano (ADA) investors, according to an announcement by Incheon police on June 3.

Police in Incheon apprehended 13 individuals, with seven held on charges of "organized crime," while the remaining six were released on bail. The raid yielded mobile phones, laptops, and cash, providing evidence of the operation's activities.

Scammers Exploit Dark Web Data to Dupe Investors in Crypto Mining Scheme

The group allegedly enticed investors with promises of substantial profits from crypto mining machines, deceiving them out of approximately $518,000. The operation targeted individuals aged between their 30s and 60s, exploiting a dark web database to initiate contact with potential victims.

Investigators uncovered that the scammers acquired personal information from a dark web vendor, using a call center to pitch fraudulent investment opportunities to crypto enthusiasts. By leveraging a Telegram-based vendor, they obtained citizen data, including names, to execute their scheme.

Operating from February 14 to March 4, the perpetrators employed a call center to present victims with a "VIP promotional offer" for purchasing crypto mining rigs at discounted rates. They falsely assured investors of guaranteed profits based on their investment amounts.

Law Enforcement Cracks Down on Crypto Scammers Linked to Gangs, Seizes Assets

Upon suspicion, the masterminds took measures to evade law enforcement, including abandoning communication channels, shutting down websites, vacating premises, and liquidating bank accounts. Despite these efforts, authorities managed to apprehend the suspects.

Several individuals involved were linked to violent gangs in Seoul and Incheon, with drugs and related paraphernalia found in one suspect's residence. Police have frozen assets worth $88,000 and sought court orders to block an additional $360,000. Luxury items and a high-end vehicle were confiscated from the mastermind's residence.

Authorities are providing support to victims in recovering their funds and have cautioned against similar scams. Last year saw a surge in crypto mining-themed scams, particularly targeting individuals through dating platforms.

South Korean authorities' crackdown on the alleged fake crypto mining operation underscores the ongoing battle against fraudulent activities in the crypto space. Despite the elaborate schemes employed by scammers, law enforcement efforts aim to protect investors and maintain trust in the burgeoning crypto market.