32 indicted in NT$800 million crypto fraud case

Taipei, April 26 (CNA) The Taipei District Prosecutors Office on Friday indicted 32 individuals, including a prominent lawyer, as part of a cryptocurrency fraud case where the defendants are accused of profiteering almost NT$800 million (US$2.46 million) from defrauding victims.

According to a press release from the office on Friday, the sum is based on claims made by known victims who filed complaints with prosecutors.

Prosecution said a fraud investigation was launched into the chairman of ACE Exchange Wang Chen-huan (王晨桓), who was managing partner of Taipei legal firm Chien Yeh Law Offices after investors filed the complaints.

The investors were allegedly deceived into purchasing such low grade virtual currencies as MoChange Token, CSO, FITC, NFTC and BNAT, which, according to prosecution have no practical applications in the foreseeable future.

Prosecutors said Wang and associates David Pan (潘奕彰) and Lin Keng-hong (林耿宏) penned fake promotional materials in 2019 to launch ACE Exchange as well as ProEx platforms to trade virtual currencies.

In addition, Pan and Lin also established direct sales teams to push the low grade cryptocurrencies through false internet advertising to draw in prospective buyers.

Subsequent investigations revealed that Pan and Lin's organizations raked in at least NT$2.2 billion from unknowing investors through the sale of cryptocurrencies and blockchain products, making almost NT$800 million in profit.

According to prosecutors, money laundering techniques used by the group included cashing in investments and then hiding millions of dollars in cash in various locations around Taipei and New Taipei for unspecified uses.

More than NT$100 million was used to procure real estate in Yilan County as a money laundering front, prosecutors said.

Prosecutors added that Wang's role in the organization placed him in control of NT$43 million, while an additional NT$47.40 million was given to various individuals to hide the fact that they were engaged in money laundering.

Wang also used his legal expertise to assist members of the syndicate by arranging for cryptocurriencies sold by the company to be available on cryptocurrency derivatives trading platforms Deepcoin and Uniswap, prosecutors said.

Working with New Taipei's Criminal Investigation Corps, Taipei prosecutors said they seized more than NT$400 million in cryptocurrency, more than NT$200 million in Taiwan dollars, a Mercedes Benz and a McLaren.

A total of 32 people from the syndicate have been indicted for organized crime, fraud and money laundering related offenses.

Given the size of the fraud and the number of victims involved, prosecutors said they have asked the court to sentence the four primary defendants to at least 20 years in prison.

A minimum sentence of 12 years is being sought for Wang who used his knowledge of the law to aid and abet criminal activity.