South Korea Investigates Crypto Scam that Promised Investors Doubtful Treasures

South Korea Investigates Crypto Scam that Promised Investors Doubtful Treasures

Authorities of South Korea has begun an investigation of a conceivable crypto investment scam. The key figure involved in the scam is the Seoul-based Shinil Group, as Korea JoongAng Daily revealed July 31. Shinil Group (Shinil) allegedly guaranteed to pay investors in gold lifted from a sunken Russian ship.  

Who Lives in a Pineapple Under the Sea

Not long ago, Shinil declared it had discovered the Dmitrii Donskoi, a Russian armored cruiser sunk 113 years ago. The firm claimed that the ship was stacked with gold worth 150 trillion won ($131 billion).

To urge investors to buy the firm’s own digital money, Shinil purportedly guaranteed to compensate them with the gold from the ship. The coin collected 60 billion won ($53.7 million) in investments from approximately 100,000 stakeholders since its launch this year, despite the fact that the company’s CEO Choi Yong-seok has conceded there is no reasonable proof that the ship contained anything of significant worth.

The Proceedings

Seoul's Gangseo District Police thusly issued a travel ban on Choi and is going to question him and other parties involved in the investigation. According to Korea JoongAng Daily, the scam likewise included Yu Ji-beom, leader of a Singapore-based associate of Shinil Group.

Supposedly, Yu built up a crypto exchange Donskoi International Exchange and spread information about the shipwreck via social networks. As per his associates, Yu has already been sentenced for a real estate fraud and is right now in Vietnam to keep away from the investigation.

The Vague Circumstances

It is still unclear whether the suspects from Shinil endeavored to benefit from fluctuations in the share prices of South Korean producer Jeil Industries. Shares spiked by 30 percent on July 17 when the former head of Shinil Group Ryu Sang-mi turned into the second biggest investor in the Jeil Steel. The following day, when prices dropped, Jeil declared that it had nothing to do with Shinil's ship rescue venture.


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