Korean law enforcement agents are now pointing their searchlight into the operations of Shinil Group, a firm that claimed to have found more than $100 billion worth of gold in a sunken Russian shipwreck. The firm then lured investors into buying its Shinil Gold Coin, promising them huge rewards in gold, as reported by sources close to the matter on August 1, 2018.
Another Crypto Scam?
According to a local news source, Korea Joongang Daily, the chief executive of Shinil Group, Choi Yong-Seok, has been barred from leaving South Korea by Seoul’s Gangseo District Police till the investigation is over.
Shinil Group and its affiliates had earlier claimed to have discovered the wreck of the Russian battleship, Dmitrii Donskoii, which contained about 150 trillion won ($131.8 billion) worth of gold and sunken treasures. The firm went ahead to launch its own cryptocurrency, which it sold to more than 100,000 people, promising them huge chunks of gold and other treasures.
No Treasures Anywhere
Per the investigation, the whole scam investment scheme was orchestrated by Yu Ji-beom, head of one of the affiliates of Shinil Group in Singapore. Yu, an ex-convict who reportedly fled to Vietnam in a bid to escape being sent to jail in South Korea for his previous criminal acts, launched the Donskoi International Exchange and uploaded fake images of the shipwreck on social media to deceive gullible investors.
Notably, the Korea Institute of Ocean Science and Technology, as well as Dong Ah Construction Industrial company, have both disputed Shinil’s bogus claims.
With thousands of people already invested in the Shinil Gold Coin scheme and Yu Ji-beom still far away in Vietnam enjoying his loot, the crypto for gold scam has been another hugely successful scheme.
Although this is not the first time that South Korean cryptocurrency enthusiasts are falling victims to bad actors who promise too-good-to-be-true returns on investments, it’s worth noting that such scams are steadily on the decline in the region.
Korea Ready to Crush Crypto Scams
Despite the fact that Korean regulators are working around the clock trying to sanitize the local cryptospace, it is quite sad that some investors still find it difficult to differentiate between a fraudulent scheme and a genuine crypto-based investment.
In July 2018, BTCManager reported that several cryptocurrency-centric security firms in the region had taken it upon themselves to research credible ICO projects for professional investors.