Movie 'Master' Lee Byung-hun's Evil Deeds Realized... "60% Profit Rate" The Truth About Chiacoin [Economic Crime 24 Hours]

Elderly-Targeted Cryptocurrency Scam Gang
Recruiting Investors for Unfamiliar 'Chia Coin' Mining Machine Business
Victims Lured with Recovery Promises Amid Investigation

There is nothing more dangerous than investing in a business that guarantees profits. This is especially true for new items that have recently gained attention, including cryptocurrencies (coins). However, when approached with a kind impression and given detailed explanations, it is easy to be deceived. This was the case for Mr. Jeong, a man in his 60s who recently retired and was looking for a place to invest his severance pay.

Movie 'Master' Still Cut

Mr. Jeong invested over 20 million won in a coin mining business in the first half of 2022. He first learned about ‘Chia Coin’ at a business briefing he attended with an acquaintance. There, he was told that investing in the Chia Coin mining business would guarantee not only the principal but also a monthly return rate of 60%, which moved him. After carefully reviewing the business plan presented by the group, he thought, ‘This will work.’ Thus, he boldly invested part of his severance pay in this business.

In 2021, Mr. Yoon, along with Mr. Park and Mr. Choi, established a fake coin mining company and recruited investors by claiming to sell mining machines capable of mining the little-known ‘Chia Coin’ in Korea. Their explanation was that they would entrust and manage the mining machines with the investment funds, mine coins, and then provide profits like a pension. From January to June 2022, they held business briefings nationwide and received investments estimated at around 30 billion won from about 4,500 victims.

These perpetrators particularly targeted people over 60, who generally lacked understanding of coins. They even installed equipment to actually mine coins. However, this was merely a formality to explain the legitimacy of the business to investigative agencies and avoid legal punishment, as well as to deceive investors. It was a thoroughly planned crime.

The failure to conduct a proper investigation when victims reported their damages was also due to this. Since the legal concepts regarding crimes related to coins had not been established and actual mining was taking place, it appeared to be a legitimate business. However, once the case was reported to the Dobong Police Station in Seoul, a full-scale investigation began. Sergeant Kim Seong-hoon of the Intelligence Team, who had background knowledge of coins (currently with the Seoul Metropolitan Police Agency’s Criminal Mobile Unit), secured the electronic wallet addresses of the perpetrators and confirmed the actual mining records. As a result, he found the amount mined was absurdly small compared to the investment and launched an investigation.

Nevertheless, the investigation did not progress quickly. The perpetrators hired lawyers to approach victim groups and promised to recover damages, making it difficult to secure victim testimonies. Even while the police investigation was ongoing, they created other companies and promised compensation to victims. This tactic exploited the fact that victims of fraud crimes often prioritize recovering their damages over the legal punishment of the perpetrators.

A scene from the movie ‘Master,’ where Chairman Jin (played by Lee Byung-hun) plants lawyers in victim groups to confuse the investigation, actually happened in real life. Ultimately, the police determined that the final damage amount was only about 1.6 billion won, which is one-twentieth of the actual damage. Fortunately, the police applied for pre-indictment seizure of about 3.6 billion won, recovering approximately 3.2 billion won from that amount.

Despite various setbacks, the police finally applied for arrest warrants for 10 perpetrators on charges of fraud and violation of the Act on the Regulation of Conducting Fund-Raising Business Without Permission in June last year. However, only three people, including Mr. Yoon, were detained. The court did not issue arrest warrants for the remaining seven, citing the degree of their involvement in the crime.

In the end, the police sent the three detained and the seven non-detained suspects to the prosecution separately. The prosecution also indicted them separately on July 6 of the same year, and the trial is currently underway at the Seoul Northern District Court.