The New Yorker is accused of tricking investors into transferring him the equivalent of $ 4.5 million in cryptocurrencies, which he used to bet on offshore gambling sites.
According to a criminal case opened by the US Attorney's Office, Douglas Jae Woo Kim, who lives in New York, has fraudulently obtained from three investors BTC and ETH worth more than $ 4.5 million.
The Justice Department claims that Kim was posing as a cryptocurrency trader and asked for loans for low-risk investments in which he said he had already invested between $ 300,000 and $ 400,000.
After receiving the funds, Kim sent either all of them or a substantial amount to offshore cryptocurrency-backing gambling sites Nitrogen Sports and Fairlay, according to the prosecutor's office.
Between October 2017 and May 2020, Kim convinced three investors to transfer 123 BTC to him, equivalent to approximately $ 1.1 million, 15,252 ETH worth approximately $ 3.5 million, and approximately $ 30,000.
While Kim has pledged that investors will receive back not only the loans, but also high interest rates on them, the Justice Department says that most of the BTC and all ETH will not be easy to recover.
At the moment, only one investor has managed to return his funds. According to the testimony received by the FBI, none of the investors suspected that their money was being used on the playgrounds.
Kim has been charged with electronic fraud by the Justice Department. He appeared in court this week and, if found guilty, faces up to twenty years in prison and a $ 250,000 fine.
Recall that recently, the US Federal Bureau of Investigation (FBI) arrested a group of fraudsters from Nigeria who lured $ 17.5 million in bitcoins from two Chicago firms, posing as accountants.
In addition, recently the US Department of Justice accused a Texas resident of illegally receiving social benefits for employers in the amount of $ 1.1 million, which he spent on the purchase of cryptocurrencies.