South Korean CEO Detained in 366 Million Cryptocurrency Fraud
The CEO of South Korean tech company Wacon, Byun Young-oh, has been apprehended on charges of allegedly orchestrating a significant cryptocurrency fraud that deceived over 500 investors. Alongside an accomplice named Yeom, Byun is accused of running a Ponzi-like operation through a platform called MainEthernet.
Wacon, which reportedly boasts around 12,000 members, is under suspicion for functioning as either a Ponzi scheme or a multi-level marketing endeavor. The firm promotes virtual currency staking products, including tipping and mainnet services, without proper registration with financial regulatory authorities. Its operations extend across various locations in South Korea.
The fraudulent scheme is alleged to have accumulated a staggering $366 million, primarily targeting senior citizens. Many of these individuals were enticed with promises of interest rates ranging from 45% to 50% on their Ethereum (ETH) deposits.
Details of the Fraud
The platform, marketed as a digital wallet service, attracted investors with assurances of safe and profitable returns. However, by mid-2023, reports began circulating that investors were facing difficulties withdrawing their funds. In spite of these alarming signs, Byun reassured investors that the problems would be rectified within a few months. By November 2023, indications of the company’s impending failure became evident when MainEthernet’s office in Seoul removed its signage.
The Seoul Central District Prosecutors’ Office has formally charged Byun and Yeom with fraud, and the case is anticipated to proceed to trial shortly. Prosecutors are actively investigating the full scope of the fraudulent activities, aiming to identify more victims and potential co-conspirators. Byun has denied any involvement in a Ponzi scheme, asserting a lack of awareness about such operations. The investigation remains ongoing.
This reporting has been supported by local media outlets Cheonji Daily and iNews24.
