Home » South Korean Police Probe Crypto Mining Outfit on ‘Ponzi Scam’ Suspicion

South Korean Police Probe Crypto Mining Outfit on ‘Ponzi Scam’ Suspicion

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Source: Busara/Adobe

South Korean police are investigating a cryptocurrency mining company that allegedly failed to repay investors after promising up to 12% monthly returns.

According to the news agency union and newspaper Chosun Ilbo, police intervened after a lawyer representing a group of investors filed a legal complaint. The allegations center around a company named ‘Btbank’. The English translation of the company’s Korean name (비트뱅크) is “Bitbank” (not to be confused with the bona fide Japanese cryptocurrency exchange of this name). It also seems to go by the name OK-Bit.

Company’s website Here you can find promotional information about KOK Play. This “tiered membership” project is Ethereum (ETH)A base altcoin named KOK play and now South Korean police are investigating.

Cryptonews.com previously reported on KOK Play and the construction of a lawsuit against the company. A reader contacted us after the publication of our latest report on KOK Play. Cryptonews.com Claims that KOK Play has “a deeply involved family.” The same individual said he “saw the company destroy relationships” with “deceptive tactics.”

Police said Btbank was accused of failing to return investment rights to investors. The company is said to have told investors that it could profit from mining tokens using rigs based in South Korea and abroad.

Like other alleged mining scams, the company is said to have promised to become an investor. “High tier” investors were told they could expect a 12% return on their bets.

Investors were told to deposit in US dollars and were asked to invest $200,000 in the project. They were told that the company operates six mining centers in South Korea, in addition to a mining farm in Kazakhstan.

Another Cryptocurrency Mining Ponzi Scheme?

Police claim BtBank’s business model utilized a “multi-level structure” that offered “bonuses when existing investors signed up for new investors.” The company is said to have told potential investors that he could invest at least $250 in the project. However, the wager was reportedly fully refunded and could be withdrawn at any time via the BtBank platform.

Every time they recruited new investors, the company allegedly promised to raise the “level” of existing members. A prolific recruiter was told that in a month he could earn a bonus of 50% or more.

But lawyers argue that since the middle of the year, many investors have been unable to withdraw their funds. “Investors closed their accounts and tried to recover their investments,” Chosun reported. However, the company reportedly “delayed payments” for “several months.”

Lawyers claimed that “more than 200 victims” were left without access to funds.

One of the law firms involved in the class action lawsuit predicted that “more than 1,000 victims” may have been left out of pocket.

BtBank said it responded by creating an “investor association”. It also said it would focus on “recovering investment by reducing the size of its headquarters” and reducing “fixed costs.”

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