'Largest Ever' Virtual Accounts: 70,000 Distributed Network Uncovered

Voice Phishing Crime Government Joint Investigation Team
Arrests Group Selling 72,500 Virtual Accounts

A virtual account distribution organization that sold about 70,000 virtual accounts, the largest scale ever, to criminal organizations and gained unfair profits has been booked by the prosecution.

On the 20th, the Seoul Eastern District Prosecutors' Office announced that the government joint task force on voice phishing crimes booked four people, including the head of the virtual account distribution organization, Mr. A, on charges of violating the Electronic Financial Transactions Act, aiding fraud, and aiding computer-related fraud, and three of them were arrested and prosecuted.

According to the prosecution, the virtual account distribution organization is suspected of selling 72,500 virtual accounts to voice phishing and illegal site operation organizations and pocketing about 1.1206 billion KRW in commission fees. The virtual accounts they distributed are the largest scale among virtual account distribution organizations detected so far. The total amount of voice phishing victim funds and gambling funds transferred through the provided virtual accounts reached 590 billion KRW.

It was confirmed that virtual account seller Mr. A, manager Mr. B, and distributor Mr. C established a shell corporation for the purpose of distributing virtual accounts, acquired the authority to manage virtual accounts of savings banks held by a payment agency, and provided 72,500 virtual accounts to voice phishing and illegal site operation organizations.

They acted as sellers (merchants) in the virtual account business structure, recruiting criminal organizations such as voice phishing and illegal gambling as affiliated stores and managing illegal funds. When funds deposited into virtual accounts are requested for withdrawal by affiliated stores, they are transferred to designated accounts after approval by the merchant. In particular, it was investigated that about 120 million KRW deposited by six victims was delivered by transferring the victim funds deposited in the virtual accounts to accounts designated by the voice phishing organization.

Criminal Structure of Virtual Account Distribution Organization
[Image Source=Seoul Eastern District Prosecutors' Office]

The joint task force requested cooperation for follow-up measures such as contract termination and suspension of virtual account use from the payment agency authorized to sell virtual accounts in this case, blocking the possibility of additional crimes using virtual accounts sold by the distribution organization. They also filed for seizure and preservation of cash and related accounts of the defendants to confiscate criminal proceeds and are conducting investigations into the voice phishing organizations that purchased the virtual accounts.

A prosecution official said, "To prevent illegal use of virtual accounts used as means of crimes such as voice phishing, we plan to share the actual situation of virtual account distribution and management issues with financial authorities," adding, "We will continue thorough investigations into voice phishing crimes and work on system improvements to prevent voice phishing."