"If You Invest in Secondary Batteries, You Get 2-3 Times Back"... Ended Up Spending 1.7 Billion on Gambling

Man in his 50s Charged with Fraud under the Act on the Aggravated Punishment of Specific Economic Crimes

A man in his 50s who deceived numerous victims by promising high returns through investments in over-the-counter stocks and embezzled billions of won has been handed over to the prosecution.

According to Yonhap News on the 9th, the Uijeongbu Police Station in Gyeonggi Province arrested and sent Mr. A, in his 50s, to prosecution on charges of fraud and violation of the Electronic Financial Transactions Act.

Forgery balance verification used by the suspect
[Photo by Uijeongbu Police Station]

Mr. A is accused of collecting investment funds from investors by claiming that investing in over-the-counter stocks related to the secondary battery business could yield two to three times the investment amount, then embezzling the funds using a so-called “Ponzi scheme.”

A Ponzi scheme is a multi-level financial fraud method that does not generate actual profits but pays returns to existing investors using money from new investors.

During this process, he reassured victims by showing forged bankbook balance photos, investment profit photos, and investment agreement contracts. After the investigation tightened from November last year following reports from victims who did not receive their investment returns, Mr. A fled ahead of a warrant hearing at the end of March.

As a result of the investigation, 11 victims have been identified so far, with damages amounting to 1.7 billion won. The police, who pursued him, identified that Mr. A had taken a job at an industrial complex in Gyeongnam and arrested him on the 1st.

Mr. A had served five years in prison for fraud and other charges and was released in April 2022. He committed the crime less than a year after reentering society. It was also found that the embezzled money was used for illegal gambling funds. The police are continuing investigations into accomplices, including his common-law wife Ms. B, who lent him her mobile phone and bankbook.

Meanwhile, damages caused by Ponzi schemes have been increasing recently. A group that deceived about 100 people by claiming profits from an overseas aluminum business and embezzled 6 billion won was handed over to the prosecution on the 1st. On the 6th, the police launched an investigation into Kim Hyun-jae, chairman of the real estate investment company K-Samhung, and related executives. They are accused of promising excessive returns to investors and conducting illegal multi-level marketing operations.