South Korean police bust gift certificate-fueled voice phishing scam

A sophisticated money laundering operation, exploiting gift certificates and cryptocurrency, has been dismantled by police in Hwaseong Dongtan, South Korea, leading to the arrest of 28 individuals. The group is accused of siphoning off approximately 883 million won from 48 victims through a novel voice phishing scheme. The operation's distinct feature was its multi-stage money laundering process: first acquiring debit cards, then purchasing gift certificates, cashing them out, and finally converting the funds into cryptocurrency for overseas transfer.

The scammers targeted individuals with low credit scores, promising them loans in exchange for their debit cards and bank accounts. They then contacted other victims, posing as financial institutions, and instructed them to repay existing loans immediately by transferring funds to the compromised accounts. To circumvent traditional anti-fraud measures like delayed withdrawal systems and suspicious transaction monitoring at bank branches or ATMs, the perpetrators used large-scale gift certificate vending machines, known as kiosks, often found in hypermarkets. This allowed them to quickly convert the illicit funds into gift certificates, reportedly with a mere 3% commission.

The elaborate scheme began to unravel in March when KB Kookmin Bank detected an unusual pattern of continuous, large-volume gift certificate purchases linked to a specific debit card. The bank promptly alerted the police, who launched an investigation. Through surveillance and rapid suspect identification, the police apprehended the individuals involved. The investigation also led to the identification of 36 additional victims. In response to this case, Hwaseong Dongtan Police Station has established a system for immediate investigation requests upon detecting suspicious transactions with KB Kookmin Bank and plans to expand similar collaborations with other financial institutions to combat gift certificate-based money laundering.