Korean mining company suspected of $275 million scam, President’s Assistant serves imprisonment

The Korean Incheon District court sentenced the company's representative for suspected scam by Korean mining company,accused roped in 330 billion KW

By · Jul 19, 2020 . 5min read

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On 19th July, a Korean mining company was suspected of defrauding 330 billion Korean Won by violating anti-scam and door to door sales law in Korea. The Korean Incheon District court has sentenced for imprisonment for two and a half years. The accused is a company’s representative and President’s secretary of the mining company. The charged aged 43 under the pseudonym of Mr.A executed the scam with the help of the Vice president and President of the company.

According to Yonhap news agency, the mining operation company was accused of violating laws and carrying out fraudulent activities. Mr.A was said to be working with the company from 1st May to 23rd September 2017. He deceived people into purchasing mining equipment and received about 331 billion Korean Won along with his associates.

The Mining Company’s fraudulent landscape

The mining company promised members that if they purchase cryptocurrency mining equipment and run it, then they will earn 60% of the mining rewards in terms of the mined currency. To recruit investors in their treacherous practice, they followed a pyramid model. Under the pyramid model, the company recruited top investors who were then instrumental in recruiting low-level investors. The mining company then paid allowances to upper investors to lure low-level investors, thus deceiving them to participate in the chain.

The Korean Icheon District Judge said that it was a massive scam affecting masses. He added that the damage caused to the victims was astronomical.

The Mining company deceived the investors by advocating that they were mining normally. Moreover, the President and Vice president fled the country. They paid allowances to the upper investors from the investment made by low-level investors. Hence the company neither mined cryptocurrencies nor did the investors.

With the adoption of cryptocurrencies worldwide, the number of crimes is subsequently increasing. Individuals must take informed decisions before indulging into any such activities that can lead to subsequent financial losses.

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