Altcoin News: In South Korea, Detained 12 People Responsible for Creating the $19 Million Crypto-Pyramid

April 8, 2019, by Marko Vidrih on ALTCOIN MAGAZINE

The authorities of South Korea last week suspended the activities of the Ponzi scheme, the victims of which were about 56,000 people who invested over 21.2 million won (about $18.7 million).

As Korea Joongang Daily reports this Monday, a special unit of the Seoul Public Security Police detained two scheme managers. One of them was responsible for the electronic sales site, the second — for the cryptocurrency exchange. In addition to them, 10 people were arrested who were engaged in engaging citizens in the pyramid since May of last year.

The media writes that in the process of catching criminals the police used advanced technological solutions, including an “investigative mechanism based on artificial intelligence.”

“Through keywords such as Ponzi, loan and recruiting members, we were able to teach the AI patterns of Ponzi schemes,” said Hong Nam-ki, the section chief of the bureau’s second investigation team. “The program can also identify advertisement patterns and identified the enterprise in question, which [was caught] with evidence provided by an unnamed informant. “In our stakeout, we saw that most people attending the swindler’s presentation for membership were elderly people in their 60s and 70s,” Hwang added.

According to the authorities, two managers in June last year created an electronic sales site, which only participants in the scheme had access to, and a cryptocurrency exchange. Investors were charged an annual commission of $388 for regular membership and $865 for a premium. As in other financial pyramids, for attracting new participants to the scheme, existing investors were entitled to bonuses.

The company carried out all calculations with the help of the M-coin token not represented on the stock exchanges, the cost of which, according to the promises of the organizers, was to grow 3 times in the near future. Among the victims of the scheme were many representatives of the older generation who did not understand the nature of digital assets.

Author: Marko Vidrih