Social media star exposed: The deceptive empire of Mr. Pips

Authorities have indicted TikToker Pham Duc Nam, known online as "Mr. Pips," on fraud charges, with over VND5,000 billion (US$200 million) in assets frozen. His case highlights the alarming proliferation of deceptive schemes involving investment consultancy and brokerage in securities, gold, and other financial products.

Major fraud network busted

The investigative agencies have initiated legal proceedings against Pham Duc Nam (30, residing in Ba Ria - Vung Tau), Le Khac Ngo (34, residing in Hanoi), and 24 others. They face charges of "fraudulent appropriation of property," "failure to report a crime," and "money laundering."

Nam, who gained notoriety on social media as Mr. Pips, amassed a following with videos teaching international stock market investing, forex trading, and financial management. He frequently showcased exaggerated profits and flaunted a lavish lifestyle adorned with gold, luxury cars, and extravagant possessions.

Preliminary investigations revealed that Nam collaborated with Le Khac Ngo to establish a fraudulent scheme modeled after international stock brokerage firms. Under the guise of legitimate companies and telemarketing platforms, they purported to offer financial advisory services and securities brokerage for stocks in major companies like Facebook and Apple.

Nam and his accomplices lured victims into private chat groups, enticing them to trade on their platforms. Victims were encouraged to take out leveraged loans for high-stake trades, which ultimately led to the rapid depletion of their accounts. The perpetrators then appropriated the victims’ remaining assets.

Authorities have searched and confiscated assets linked to the suspects, totaling more than VND5,000 billion.

Before his indictment, Nam had a significant online presence, with his videos garnering hundreds of thousands, sometimes millions, of views. In his livestreams, he provided analysis and predictions on the prices of gold and cryptocurrencies, consistently promoting high-risk investments as a path to wealth and happiness.

Nam frequently advised his followers to invest large sums, claiming it was the only way to achieve substantial returns. He boasted of an undefeated 10-year track record in gold and international stock trading and enticed followers to join private Telegram groups. Within these groups, he showcased allegedly massive profits and introduced the concept of "copy trading," where followers mirrored his trading strategies.

Proliferation of investment scams

In recent years, scams targeting individuals with disposable income have surged, particularly in the domains of gold and international securities. Many people report receiving daily calls from individuals posing as representatives of reputable brokerage firms, inviting them to join investment chat groups. Some victims lost significant sums after depositing money into trading platforms, only to find they could not withdraw their funds.

On social media and online forums, advertisements for high-yield investments in gold, cryptocurrency, and international securities abound. Scammers often promote copy trading, targeting individuals lacking financial expertise. They promise substantial returns with minimal effort - victims simply deposit funds into accounts managed by the scammers.

Sophisticated schemes also involve fake identities created using AI technology. Scammers impersonate prominent figures in finance, such as Nguyen Duy Hung (Chairman of SSI Securities) or billionaire Tran Dinh Long, to build credibility and attract investors.

In August, SSI Securities warned investors of fraudulent schemes involving impersonations of Nguyen Duy Hung. Scammers conducted fake livestreams, providing bogus financial analyses and investment advice. Victims were directed from Zalo to private Telegram groups, where AI-generated videos of Hung were used to persuade them to invest.

This issue is not isolated to SSI. Other firms, such as MBS, VNDirect, and various investment funds, have repeatedly cautioned about similar scams. Prominent corporations like Hoa Phat Group (HPG) and Vingroup (VIC) have also issued warnings after being impersonated.

In some cases, fraudsters forged documents with counterfeit “wet signatures” and official seals, created fake websites mimicking Vingroup’s ecosystem, and even produced fictional films and TV channels to lure victims with promises of high returns and lucrative benefits.

A brokerage director noted that cryptocurrencies and forex trading remain unregulated in Vietnam. The State Bank of Vietnam has not licensed any forex trading platforms, making all such activities illegal. Investors are urged to exercise caution and avoid unverified schemes operating outside the law.

Origins of the scheme

On the morning of December 9, during a side discussion at a Hanoi People's Council meeting, a representative of the Hanoi People’s Procuracy confirmed ongoing investigations into the online fraud network linked to Pham Duc Nam along with Le Khac Ngo (34, from Hanoi) and 24 others.

The Hanoi Police Department initially expanded the investigation after receiving the case from the Cau Giay District Procuracy, which had approved charges of "fraudulent appropriation of property," "failure to report a crime," and "money laundering." Following this, additional suspects were charged as the case unfolded.

“Using a stock brokerage model, the suspects entrapped victims, making it impossible for them to withdraw their funds. The amount defrauded is estimated to reach several thousand billion Vietnam dong. Investigations are ongoing to identify additional victims and finalize conclusions,” the official stated.

In late October 2024, following months of investigative work, Hanoi police, in collaboration with the Cau Giay District Police and other units, dismantled a large-scale online fraud operation spanning multiple provinces and cities.

Preliminary findings show that in June 2019, Pham Duc Nam partnered with Le Khac Ngo to establish a fraudulent financial operation modeled after international stock brokerages. Their scheme involved posing as a legitimate company, creating websites and networks that offered telemarketing and telesales services under the guise of financial investment advice and securities brokerage. They promoted well-known international stocks like Facebook, Apple, Pepsi, Microsoft, and Adidas to lure victims.

Nam and Ngo created a website called "artexvina.co," recruiting staff and crafting the image of a professionally managed investment advisory firm specializing in international securities trading. They expanded their operations nationwide, focusing on key areas like Ho Chi Minh City, Hanoi, Da Nang, and even neighboring Cambodia.

The fraudsters used their workforce to approach potential investors, inviting them to participate in private chat groups. Victims were first taught to deposit and withdraw money smoothly to build trust. Once the victims felt confident, they were encouraged to place larger trades using leveraged loans. This led to rapid account losses, referred to as "account burning," which allowed the fraudsters to seize the victims' remaining funds.

Even after victims lost all their money, the group continued to exploit them by inviting them to invest in new trading platforms. They made enticing promises that the victims could recover their lost funds, thereby further defrauding them.

Nam and Ngo organized a highly structured network with dedicated departments, including IT, support, administration, and security. Their team underwent rigorous training to execute the fraudulent activities seamlessly.

During emergency searches of the suspects' residences and workplaces, authorities confiscated assets valued at over VND5,000 billion. These included:

VND127 billion in cash.
Savings books worth approximately VND306 billion.
216 kilograms of gold.
128 real estate properties.
30 cars of various types.
VND9 billion in bonds.
Numerous other valuable assets.

Police urge accomplice Le Khac Ngo to surrender

As the investigation into the massive fraud network led by TikToker Pham Duc Nam expands, Hanoi Police have indicted additional suspects and urged accomplice Le Khac Ngo to surrender and return stolen assets for leniency.

On the afternoon of December 10, Hanoi Police announced charges against 31 individuals connected to the scheme. Among them, 26 face charges of "fraudulent appropriation of property," three for "money laundering," one for "failure to report a crime," and one for "harboring assets acquired through criminal activities."

Le Khac Ngo (born in 1990, residing in Phu Dien, Bac Tu Liem District, Hanoi) has been urged to turn himself in and return the assets he acquired through fraud to qualify for reduced sentencing.