Langgam Pos - The CEO of South Korean tech company Wacon has been arrested on allegations of orchestrating a large-scale cryptocurrency fraud that deceived more than 500 investors.
Byun Young-oh, the CEO, along with his accomplice identified as Yeom, is accused of running a Ponzi-like scheme through a platform called MainEthernet. According to a report from Coinmarketcap on Thursday, August 15, 2024, Wacon, which reportedly had around 12,000 members, is believed to have operated as a multi-level marketing (MLM) campaign or Ponzi scheme.
The company offered virtual currency staking products, including tip businesses and mainnet services, without proper registration with financial authorities. Wacon had branches throughout South Korea.
The fraudulent scheme allegedly raised approximately $366 million, equivalent to IDR 5.8 trillion (assuming an exchange rate of IDR 15,948 per USD), primarily targeting elderly individuals.
The fraudulent scheme allegedly raised approximately $366 million, equivalent to IDR 5.8 trillion (assuming an exchange rate of IDR 15,948 per USD), primarily targeting elderly individuals.
Many of them were promised interest rates ranging from 45% to 50% on their Ethereum deposits.
Details of the Fraud
The platform, functioning as a digital wallet service, lured investors with promises of safe and lucrative returns. However, by mid-2023, reports began to surface that investors were unable to withdraw their funds.
Despite these concerns, Byun assured investors that the issues would be resolved within a few months. In November 2023, signs of the company's impending bankruptcy became apparent as the MainEthernet office in Seoul removed its company signage.
The Seoul Central District Prosecutors' Office has charged Byun and Yeom with fraud, and the case is expected to go to trial soon. Prosecutors are continuing to investigate the extent of the scheme, seeking to identify additional victims and possible accomplices. Byun has denied any involvement in a Ponzi scheme, claiming he was unaware of the structure. The investigation is ongoing.
Disclaimer:
Details of the Fraud
The platform, functioning as a digital wallet service, lured investors with promises of safe and lucrative returns. However, by mid-2023, reports began to surface that investors were unable to withdraw their funds.
Despite these concerns, Byun assured investors that the issues would be resolved within a few months. In November 2023, signs of the company's impending bankruptcy became apparent as the MainEthernet office in Seoul removed its company signage.
The Seoul Central District Prosecutors' Office has charged Byun and Yeom with fraud, and the case is expected to go to trial soon. Prosecutors are continuing to investigate the extent of the scheme, seeking to identify additional victims and possible accomplices. Byun has denied any involvement in a Ponzi scheme, claiming he was unaware of the structure. The investigation is ongoing.
Disclaimer:
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