[Exclusive] "10% Monthly Dividends"... Business Trips from Seoul to Japan [Coin Scam Republic]

Special Feature <Coin Fraud Republic - They Were Meticulous>

②-⑴Reconstructing the Business Practices of a Multi-Level Scam Case
Former Jeju Mayor Attended Center Opening Ceremony to Give Congratulatory Speech
When Withdrawals Were Blocked... Denied Responsibility Claiming It Was an Order from Foreign Headquarters

"Inter Coin Capital (ICC) helps you take the lead and start your journey to unlimited assets!"

"In June (2019), ICC will donate 1,000 initial ICBX coins to 2,888 lucky members worldwide. Seize this opportunity first."

On September 5, 2019, the ICC Jeju Center opening ceremony was held on the first floor of Blue City Park in Doduhang, Jeju City. Former Seogwipo Mayor Park Young-bu attended the event and gave a congratulatory speech. (Provided by: ICC Victims Association)

This is promotional content posted on the ICC site by Jo, currently on trial for fraud involving hundreds of billions of won, to attract investors. ICC pretended to be an asset management company headquartered abroad, and the fraudulent activities continued for over a year. Hundreds of people were victimized during this period. How were they able to deceive so many people over the course of a year?

Asia Economy reconstructed the business practices of this multi-level coin scam case involving hundreds of billions of won through indictments, complaints, and victim interviews. Other fraud cases committed by the core perpetrators of ICC showed the same pattern of attracting victims and urging investments, merely changing the company name. Their scam methods followed a pattern: establishing the primary business operator and regional centers → attracting investors → conducting high-yield, high-dividend promotions before absconding → shutting down the site and electronic wallets → disappearing.

Bringing ICC Scam Methods from Abroad to Korea... Manipulating Returns and Deposit/Withdrawal Records

In July 2018, Jo, an ethnic Korean from China, rented an office in a building in Gwanak-gu, Seoul, and opened the ICC Seoul headquarters (Sadang). Jo took the titles of Korea branch representative and chairman and was involved in the ICC scam operation domestically, along with two accomplices of Chinese descent from Malaysia.

The Cho family and their associates established sales offices in more than 10 locations nationwide, including Seoul, to attract investors.

After establishing the primary business operator (meaning the main office), Jo and her group opened 'centers'?business offices?in various locations including Seoul headquarters (Gyodae), Gumi in North Gyeongsang, Songdo in Incheon, Masan in South Gyeongsang, Songnae in Bucheon, Ansan in Gyeonggi, Daejeon, Ulsan, and Busan. Each regional center operated with teams of 5 to 6 people, including senior recruiters. In Japan, where there was no center, Jo personally led investment briefings.

Once full-scale operations began at the regional centers, Jo’s group told investors, "If you entrust your cryptocurrency to ICC, we use proprietary artificial intelligence (AI) for arbitrage trading (buying and selling by exploiting real-time price differences between exchanges) to pay dividends of 0.333% daily, about 10% monthly. Entrusted cryptocurrency can be withdrawn at any time." This represented an evolution of traditional multi-level marketing, which mainly sold goods like Ok mats, into a new form of multi-level scam combined with digital financial technology. They also enticed investors by saying, "If you refer 10 people, you will receive an additional 8% dividend on those you referred." This referral system is a typical multi-level marketing method for attracting investors, enabling a Ponzi scheme structure where new investments pay off existing investors.

ICC promoted the content to attract investors. (Provided by ICC Victims Association)

Coin scam organizations including ICC uniformly promoted that their headquarters were overseas, making it impossible to verify unless one visited the foreign headquarters directly. ICC claimed to be a global company headquartered in California, USA, stating, "We generate profits linked with 200 exchanges worldwide and have 16 centers globally." This was a calculated strategy to later shut down electronic wallets and the site, shifting responsibility to the headquarters.

To lure hesitant investors, Jo’s group produced dozens of promotional videos using social networking services (SNS) such as Naver Band, KakaoTalk, and Telegram. They also held meetings posing as investment seminars while touring key regions.

FVP Trade (FVP), presumed to be established by Jo, celebrated its first anniversary in May 2022 by inviting over 1,000 people to the Walkerhill Hotel in Seoul. Jo tearfully said at the event, "My lawyer said FVP is 'legal.'"

Invitation to the 'FVP 1st Anniversary Event' held at the Walkerhill Hotel in Seoul. According to the victims, more than 1,000 people gathered at the event alone. (Provided by: FVP Victims Association)

When the Jeju center opened in September 2019, a prominent local figure attended. According to Asia Economy’s coverage, former Seogwipo Mayor Park Young-bu gave a congratulatory speech at the opening ceremony. Victims who saw photos of Park standing alongside Jo’s group recalled, "We had no choice but to trust them." They said that having a prominent local politician at the center’s opening gave them confidence to trust and invest in ICC. Regarding this, former Mayor Park explained, "I attended through an acquaintance of Shin, the Jeju center head, and do not know Jo directly."

Jo’s group required investors who obtained ICC membership to download an electronic wallet app on their phones that displayed the entrusted coin balance. Investors could visually confirm the displayed returns and dividends in the wallet. Of course, this was manipulated. In FVP’s case, daily profits were paid until the site (application) was suddenly shut down.

Kim Ju-yeon (a pseudonym), who lost nearly 100 million won, said, "They issued a kind of 'investment certificate' assuring that the deposited money was safely held in the FVP account. If I wanted to withdraw $1,000, FVP sent $1,000 worth of TRON coins to my Upbit account under my name. Until the site was shut down, I could sell and cash out."

According to the indictment, from July 2019, Jo’s group introduced a new dividend structure called the 'Royal Club,' promising different dividends based on entrusted amounts. This was three months before they absconded.

The minimum ICC subscription amount was $1,000. Jo’s group was not satisfied with the amount collected this way. They wanted to absorb more money faster. Hence, they established this dividend structure. At that time, they promised Royal members cruise ship trips, Ferrari cars, and Rolex watches. They also hyped that if ICC was listed on the US Nasdaq, they would distribute stocks equal to the investment amount separately. They posted photos of physical cards, claiming they would issue cards. None of this was true. Jo’s group initially said the promotion would run until August 30, but as the date approached, they extended it to September 30.

"No one received the benefits listed above. Cards? We never even saw them. They ran off with the money before that." Oh Young-sik (a pseudonym), a representative of ICC victims, expressed his frustration.

ICC card promoted by the Cho family. (Provided by ICC Victims Association)

Withdrawal Blocked by Closure of Nonexistent Headquarters... Investors’ Assets Reduced to Zero

'Notice: ICC’s funds frozen.'

In mid-September 2019, an alarm suddenly appeared. It announced the closure of the ICC site and electronic wallet. Withdrawals were blocked, and the personal assets displayed in investors’ wallets all showed '0.' Investors scrambled to recover their principal, but Jo’s group consistently blamed it on 'headquarters decisions.' However, according to the complaint, ICC headquarters never existed. Victim Park Ji-soo (a pseudonym) visited the building claimed to be ICC’s headquarters in the US after the scam broke out and found that the building housed the Bank of California, which does not lease space externally.

The indictment also raises doubts about ICC’s existence. The indictment written in April 2024 states, "With the sudden disappearance of Roman Arayan (introduced as ICC CEO) and other executives, investors could no longer withdraw their assets. The company’s actual existence, the real identities and roles of executives like Roman Arayan, and the whereabouts of investors’ cryptocurrencies remain unclear."

After about a year of operations, Jo’s group collected approximately 11.4 billion won in cash or coins from 137 investors under the pretense of investment (as of the January 2023 indictment). However, considering only 0.5% of all victims participated in the complaint, the ICC victim group estimates the number of victims and the amount lost to be in the trillions of won.

Jo, currently on trial, still claims innocence. Jo’s lawyer, Lee Su-won of Wi Law Firm, stated, "Jo Soo-yeon was not involved in the establishment or operation of ICC and FVP. This has been clearly stated during investigations and trials, and no evidence or circumstances indicating her involvement were found during the investigation. The indictment even states that the defendant is not well acquainted with ICC and FVP. These are merely the complainants’ unilateral claims, which they seem to want to believe."

In January 2023, the Seoul Central District Prosecutors’ Office indicted Jo, identified as the main domestic perpetrator, for violating the Act on the Regulation of Conducting Fund-Raising Business Without Permission and fraud related to the ICC case. In April this year, the prosecutors added charges related to FVP fraud.

The Cho family faction conducted a large-scale promotion before freezing the funds to attract substantial capital. (Provided by: FVP Victims Association)

Continuing Fraud While on Trial... Accomplices Still Gathering Investors

Jo and her accomplices did not stop their fraudulent activities. Jo is accused of establishing FVP in April 2021. She committed another fraud while under investigation for the ICC scam. The method of attracting investors was similar to ICC. From April 2021 to July 2022, they defrauded a total of 80 victims of 26.3 billion won.

Jo is not alone. Kim (surname), named as a senior recruiter in complaints related to the two cases mentioned earlier, currently runs a coin investment site on Naver Band, gathering investors. According to an insider from this site, as of May 1, Kim had attracted about 100 billion won in investments from investors.

Some argue that individuals under investigation for investment fraud should be restricted from engaging in similar activities. They call for stricter regulations to prevent easy establishment of online investment communities. However, this conflicts with the presumption of innocence principle, making it practically difficult.

Jae-bin Jo, head of the Virtual Asset Criminal Response Team at Barun Law Firm, said, "In principle, innocence is presumed until investigations and trials conclude, so judicial measures are difficult. However, if financial authorities or investigative agencies analyze and share information on coin-related crimes and suspects, it would help strictly punish and prevent similar coin scams by the same suspects or organizations. I understand that in the past, when cracking down on organized crime, prosecutors and police used accumulated data for investigations."

We plan to conduct in-depth investigative reporting on 'virtual asset investment fraud.' We will strive to develop comprehensive countermeasures to eradicate coin crimes. Please send tips to lsa@asiae.co.kr. We will report thoroughly to the end.

▲Team Leader Lee Seon-ae, Manager △Kim Min-young, Cha Min-young, Kim Dae-hyun, Hwang Yoon-joo Reporters