Fake Flare Network Website Stole $8.5 Million Worth of XRP

In October of last year, a fake staking website, operational for eight days, stole 3.4 million $XRP from 71 investors. This amount is equivalent to 8.5 million US dollars. Seoul police stated that this fraudulent operation deceived investors by posing as Flare Network and FXRP. The fake website promised investors monthly returns of 1.5% to 1.8%, while also claiming the principal was guaranteed.

Details of the Fraud

The fraudulent operation involved tricking investors into withdrawing their $XRP from local exchanges and transferring them to wallets controlled by the fraudsters via offshore platforms. The website was shut down on October 23, and its operators disappeared. Police reported that the scammers spread disinformation on platforms such as blogs, online news articles, and Wikipedia, and also created videos using a paid lookalike on YouTube.

Police Investigation and its Results

Seoul police tracked assets totaling 27.3 billion won ($18.8 million) related to the fraud and froze 17.3 billion won. Two individuals involved in the fraud were handed over to prosecutors on charges of aggravated fraud. Furthermore, another person is under investigation on charges of document forgery related to the fraud. The police issued 54 search and seizure warrants in connection with the fraud and arrested one suspect who had returned from abroad and was in hiding.

South Korean police this year announced a policy of zero tolerance for cryptocurrency fraud and warned investors to check official sources before sending funds. This is seen as part of heightened vigilance and measures to combat cryptocurrency fraud in South Korea.