Police in the city of Incheon, South Korea, have arrested six suspects for allegedly scamming a crypto buyer out of $747,000 in cash. The suspects, aged between 20 and 39, are accused of luring the victim into a bogus over-the-counter (OTC) crypto deal and fleeing with the money.
How the Scam Happened
According to the police, the incident took place in the Songnim District of Eastern Incheon at around 4 pm on February 19. The victim, who has not been identified, said they had arranged to swap about $747,000 for crypto with vendors they contacted via social media channels. The vendors offered to sell crypto at a low price, claiming they had obtained it from overseas sources.
The victim met the vendors at a designated location, where they boarded a van to conduct the transaction. The vendors took the victim’s cash and counted it in the van, while the victim waited for the crypto transfer. However, once they had finished counting, the vendors reportedly pushed the victim out of the van and sped off, leaving the victim empty-handed.
The victim filed a police report, and officers said they used CCTV footage to identify the vehicle, its owner, and the rest of the group. The police arrested the suspects on February 20 and seized the van and the cash.
A Rise in OTC Crypto Crimes
This is not the first case of OTC crypto fraud in South Korea, where the demand for crypto has surged in recent months. In early January, police officers in the nearby town of Icheon, Gyeonggi Province, arrested a man in his 20s on theft-related charges. The man allegedly offered to sell crypto at a low price, but instead made off with $10,700 in cash from the buyer.
In September 2023, regulators said they wanted new powers to police the OTC crypto sector, which they claimed had become “the epicenter of virtual currency-related crimes”. They said that OTC crypto transactions were often used to evade taxes, launder money, or finance illegal activities.
The police have warned the public to be careful when dealing with OTC crypto vendors, and to verify their identity and reputation before making any transactions. They also advised the public to use licensed and regulated crypto exchanges, which have more security and transparency measures in place.
The Impact of OTC Crypto Scams on the Market
The increasing number of OTC crypto scams in South Korea could have a negative impact on the crypto market, which has been enjoying a bullish trend in recent weeks. South Korea is one of the largest crypto markets in the world, accounting for about 10% of the global trading volume.
The OTC crypto scams could erode the trust and confidence of the crypto investors, especially the newcomers who are looking for alternative ways to buy crypto. They could also prompt the regulators to impose stricter rules and restrictions on the crypto industry, which could hamper its growth and innovation.
However, some experts believe that the OTC crypto scams are a sign of the growing popularity and adoption of crypto in South Korea, and that they will not deter the genuine and savvy investors from participating in the market. They also expect that the authorities will crack down on the OTC crypto scammers and protect the rights and interests of the crypto buyers.