Exclusive: North Korean Defector Masterminds $728K Crypto Scam—21 Victims Left Holding the Bag
Crypto's wild west just got wilder. A North Korean defector turned fraudster has pulled off a $728,000 digital heist—leaving 21 investors staring at empty wallets. Who needs borders when you've got blockchain?
How the scam unfolded
No KYC, no problem. The perpetrator exploited crypto's pseudonymous nature, leveraging defector credibility to gain trust before vanishing with the funds. Classic rug-pull—just add geopolitical intrigue.
The compliance irony
While regulators obsess over institutional crypto frameworks, this case proves retail investors remain the low-hanging fruit. Another win for decentralized finance—if your definition of 'winning' includes getting robbed blind.
Wake-up call
The scam cuts through crypto's utopian promises like a chainsaw through butter. Maybe that 'bankless future' isn't all rainbows when the only thing getting decentralized is your net worth.
Victims funneled funds to the North Korean defector
The defector who says she served as a North Korean soldier was first approached by a Chinese national, who urged her to bring others into the investment scheme. The North Korean national, who had lived in South Korea for at least 10 years, then recruited two fellow defectors. After that, she began targeting South Korean citizens.
The former soldier persuaded victims to transfer funds in Korean Won to her account, converted the money, and deposited it into the fake platform. The victims then invested in cryptocurrencies through the counterfeit app.
At the beginning of July, the victims were unable to withdraw any funds, and the counterfeit app stopped working. The two defectors who had transferred funds to the app early were able to withdraw their initial investments more than a year ago. However, other victims who joined the investment scheme later suffered major losses after the app froze.
The former soldier, who was initially brought in by a Chinese national, claimed to have suffered financial losses as well.
If the case goes to trial, the two defectors will be brought in not only as victims but also as witnesses, according to South Korean authorities. This is because they’ve also aided in scamming other South Korean nationals.
A few months ago, Jeju Metropolitan Police arrested 25 individuals connected to four coordinated fake-crypto investment rings. The scammers lured investors via call centers and bogus exchanges, stealing over $540,000 in total. Officers believe more victims remain unaccounted for and are continuing the probe into higher-level organizers.
South Korean authorities have dismantled multiple scam operations across the country, taking dozens into custody for posing as “crypto advisors” and defrauding retail investors.
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