[Economic Crime 24 Hours] "Investing in Pet Dog Platforms" The Truth Behind Coins Guaranteeing 300% Returns

Incremental Investment from 1.2 Million to 12 Million Won
Over 51,000 Members Registered on the Website

"Invest in the development of a companion dog platform."

At the end of 2021, when cryptocurrency (coin) investment was just emerging as a new financial technology method, office worker Kim Jaewang (31), who was looking for new investment opportunities, was intrigued by an advertisement he saw online. It claimed that investing in coins related to the development of a companion dog platform could yield substantial profits. Having recently seen news that the pet population was approaching 10 million, Kim thought this was a perfect opportunity to invest in coins, an area he had been interested in.

When Kim inquired about the investment method from the coin company, he received an immediate response. He was told that investments could start from 120,000 KRW and go up to 12 million KRW depending on the investor’s choice, with potential returns of up to 300% based on business performance. Additionally, a daily allowance was promised. Encouraged by this, Kim signed up on the company’s website and deposited 120,000 KRW.

It did not take long for Kim’s doubts to disappear, as the daily allowances were steadily deposited into his account as promised. Judging it to be a legitimate financial technology, Kim gradually increased his investment amount. Although some acquaintances warned him that it seemed risky, to Kim this investment was like a "goose that laid golden eggs." He eventually increased his investment to 6 million KRW, envisioning a "rosy future."

Then, in April 2022, Kim received a phone call. The caller, identifying himself as a police officer, said they were investigating Kim’s coin investment and that transaction records with Kim had been confirmed in the company’s account. Shocked, Kim tried to access the company’s website, but it was already down, as if the server had crashed.

At the same time, the Anti-Corruption and Economic Crime Investigation Division 3, Team 6 of the Gyeonggi Southern Provincial Police Agency began investigating the company. The Financial Intelligence Unit (FIU) had requested the police investigation after detecting abnormal fund flows in the company’s account. The police collected evidence of various crimes committed by the company’s representative, Mr. A (in his mid-50s), and continued a full-scale investigation.

However, since there were about 51,000 investor accounts registered on the company’s website and the amount of money that flowed through the company’s accounts reached 166.4 billion KRW, it took several months just to identify the criminal facts. During this period, the police analyzed an enormous amount of data totaling 350GB.

One year after the investigation began, in April 2023, the police arrested the main perpetrators: the company’s representative Mr. A, the IT manager Mr. B, and the business operator Mr. C, on charges of fraud and violation of the Act on the Regulation of Conducting Fund-Raising Business Without Permission. They also apprehended 63 branch managers nationwide. Police investigations revealed that the group attracted investors by using a "Ponzi scheme," paying returns to earlier investors with funds received from later investors.

The police seized approximately 8.3 billion KRW of criminal proceeds before prosecution and handed all the suspects over to the prosecution. Currently, their trials are underway at the Suwon District Court, Anyang Branch.