An organization suspected of attracting MZ gangsters in their 20s and 30s to run four illegal futures exchanges and make over 10 billion won in unfair profits was caught by the police.
The Cyber Investigation Department of the Busan Metropolitan Police Agency arrested 10 people, including Domestic Manager A (30s) and Money Manager B (20s), both former gang members, on charges of opening gambling venues and violating the Capital Markets Act (prohibition on opening unlicensed markets). It was announced on the 12th that 26 members of the organization were arrested and booked without detention on the same charges.
The police also requested a red notice from Interpol for three people, including C (30s), the head of the organization, who fled abroad.
According to the police, from July 2022 to May of this year, Mr. A and others set up offices in Incheon, Cambodia, and Vietnam and operated four places, including an illegal futures exchange worth 113 billion won, against 6,270 members recruited through stock reading rooms. He is suspected of making unfair profits worth 11 billion won while operating the business.
Mr. A and others created an unauthorized and illegal ‘HTS’ (Home Trading System) program that is linked in real time with domestic and foreign futures trading data, and then operated an illegal stock reading room by impersonating a stock expert and authenticating false profits from futures trading. Members were recruited.
They are said to have made unfair profits by operating an illegal gambling house disguised as futures trading by having members access illegal futures exchange sites and HTS programs and actually betting on the rise and fall of futures indices such as Nasdaq (USA) and Hang Seng (Hong Kong). The police explained.
Members who participated in the transaction were allowed to trade up to 300,000 won per contract, up to 50 contracts in total, and were allowed to bet in real time on rising or falling markets. This is an illegal transaction that only takes place within the site and does not affect the actual transaction.
Members who made a profit from these bets were returned the actual amount, and the operating organization took the money of those who lost due to the bets as unfair profits. The police explained that in fact, some members saw profits of 200 million won, while others lost as much as 700 million won. The police added that it was confirmed that they took measures such as blacklisting some members who made high profits from betting and forcing them to leave.
The police reported that they appear to be operating an illegal gambling den, aiming for a long-term profitable structure.
Among these, Mr. A, in particular, was a former gangster based in Gyeongnam, and it was revealed that he had hired local MZ gangsters in their 20s and 30s as gang members and recruited Daepo bank accounts and Daepo phone holders to be used in crimes, as well as instructed them to launder money.
The police reported that they used the profits earned from operating an illegal futures exchange to purchase expensive foreign vehicles, watches, and luxury goods, or squandered them on gambling and entertainment expenses.
The police shut down the website they operated and confiscated 280 million won in criminal proceeds. In addition, a total of 860 million won worth of items, including high-end foreign vehicles, were recovered through the court’s decision to collect and preserve the proceeds of crime.
The police also notified the National Tax Service of tax evasion data to recover tax evasion on crime proceeds, and requested financial authorities to improve the system to prevent the spread of false investment advisory companies by expanding the scope of reporting and disclosure of quasi-investment advisory businesses.
In addition, the police reported that they did not book the members who carried out the transaction, considering that they promoted it as a normal trading company and that ordinary people without knowledge of futures trading could mistake it for a legal transaction. The police warned, “You should beware of illegal advertisements on social media that say you can easily trade futures without a large amount of margin using the lure of high profits.” Reporter Hwang Sang-dong
