South Korea Arrests Eight in $1.1 Million Social Media Investment Scam

South Korean police have arrested eight people accused of defrauding five victims of approximately KRW1.54 billion (around $1.1 million) through a fake investment scheme promoted on social media and YouTube.

Daejeon Yuseong Police Station said on August 12 that six suspects, including the alleged domestic operator, were detained, while two others were referred to prosecutors without detention. The group reportedly consisted of four Korean and four Chinese nationals.

The suspects allegedly lured victims with promises of investment returns of up to 100%, using fake securities firm employee IDs, investment certificates and a counterfeit trading app. Victims were directed to install the app through a link and join group chats where fabricated investment results and manipulated account balances were displayed.

Investigators said the group collected cash and gold bars from victims, claiming physical assets would help avoid financial authorities’ oversight or restrictions on withdrawals. Individual losses ranged from KRW11 million to as much as KRW1.3 billion.

Police said the alleged operation was divided into separate roles, including recruitment, collection, transportation and money laundering. Members reportedly communicated through Telegram and often did not know each other’s identities. Some proceeds were allegedly laundered through casino transactions in Seoul and Incheon.

Police eventually arrested the alleged domestic funds manager after posing as investors and arranging a meeting to hand over gold bars. Officers recovered approximately KRW258 million in cash and gold during the operation.

Authorities believe the alleged ringleader is currently in China and are investigating whether additional members were involved.

Police warned consumers to be particularly cautious of investment offers promising unusually high returns through social media or group chats, especially when victims are asked to install unfamiliar investment applications or provide cash and physical assets.