Korean director arrested for initiating fraudulent pyramid scheme

VOV.VN -Ho Chi Minh City police stated on August 10 that they have arrested and commenced criminal proceedings against a Korean citizen and a Vietnamese woman for the alleged fraudulent appropriation of assets.

korean director arrested for initiating fraudulent pyramid scheme hinh 0
Korean national Kim Bumjae is arrested for the alleged fraudulent appropriation of assets
According to investigators, Kim Bumjae, 52, from the Republic of Korea met his countryman Kim Sung-hun, who serves as director of IDS Holdings Ltd. in early 2015,

Sung-hun claimed that his company had a number of branches located globally and specialised in forex trading, before asking Bumjae to open a subsidiary branch in Vietnam and act as its representative.

According to the IDS Holdings Ltd director, the subsidiary is responsible for finding investment. Once a financier is found, part of their investment capital is taken to cover business expenses, while an additional 4% is used to pay interest for other investors. The remaining funds are then transferred to the Republic of Korea in order for the parent company to invest in the foreign exchange market.

Bumjae agreed to follow the scheme and decided to established nine companies operating under a pyramid scheme.

He also held forex classes to teach students about the foreign exchange market, opened a number of coffee shops, and promised clients that he would use their money to invest overseas.

All investments made by Bumjae’s clients were signed under business co-operation contracts with fixed monthly interest payments, the proceeds of which were then used to pay interests and commissions to the first set of investors. The rest of the money was subsequently used to maintain their system and was misappropriated for personal purposes.

Bumjae had been aided and abetted by Vietnamese local Nguyen Thi Huong, 27, who was also arrested for her role in assisting the Korean citizen to establish Raon Vietnam Company Limited and Khanh Asset Company Limited. She also participated in managing and operating several of the companies’ activities that ultimately inappropriately used clients’ money.

In total, there were 119 clients who contributed a total capital of VND80 billion to Bumjae’s various companies and have been unable to get their money back.

VOV

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