Taiwan Top Crypto Exchange Busted For Scamming Investors

The founders of ACE, one of Taiwan’s leading digital currency trading platforms, have been arrested for running a massive crypto scam. David Pan and Lin Nan, along with their team, allegedly deceived more than 100 investors of over 1 billion yuan in the past three years by using fake ads on social media platforms such as Instagram and Facebook.

According to a local news report, Lin Nan used social media to attract potential investors, promising them huge profits by listing virtual currencies on reputable exchanges. On the other hand, Pan Nan gave legitimacy to the ACE exchange, boosting the investors’ confidence in the virtual currencies listed.

The fraudsters took advantage of information asymmetry, claiming that these virtual currencies had real value and a bright future, similar to the success of Bitcoin. However, investors soon realized they were holding worthless coins with no market or exchange options.

Furthermore, the New Taipei City Criminal Police Brigade acted swiftly, carrying out multiple raids across Taipei, New Taipei, and Taichung. The police arrested Lin, Pan, and 14 employees at 15 locations, including the ACE exchange company’s headquarters.

The police seized 111.52 million yuan in cash from Lin’s home and virtual currency worth NT$108 million from the company’s office. The total illegal gains confiscated amounted to over NT$200 million, equivalent to about $6,431,532. The suspects face legal fraud charges under the Criminal Code, the Money Laundering Prevention Act, and the Banking Act.

The Need For Crypto Regulation

This incident follows the growing scrutiny on crypto exchanges worldwide. CoinDCX, a prominent crypto investment firm, recently denied reports of a Delhi Police investigation into alleged bank and crypto fraud on its mobile app. However, several complainants have filed reports of irregularities and pressure during crypto withdrawals.

Likewise, Lee Jeong-hoon, the former chairman of Bithumb, South Korea’s major crypto exchange, received an eight-year jail term over alleged fraud, with the legal battle now awaiting an upcoming appeal verdict later this month.

These recent cases underscore the urgent need for comprehensive crypto industry regulation. As the demand for digital assets increases, so do the risks of fraudulent activities. Governments and regulatory authorities must work together to create and implement strict regulations that safeguard investors and preserve the integrity of virtual crypto exchanges.

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Furthermore, the author’s views are for reference only and shall not constitute any investment advice. Please ensure you fully understand and assess the products and associated risks before purchasing.

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