Law enforcement in South Korea has successfully dismantled a large-scale illegal gambling ring that operated by leveraging a fraudulent Home Trading System (HTS) designed to simulate overseas futures trading.
The Incheon Metropolitan Police Agency confirmed the arrest of seven individuals involved in operating the sophisticated scheme, with the core figures identified as Mr. A, a man in his 40s who developed the pseudo-HTS program, and Mr. B, a man in his 30s who managed the primary gambling network.
Both Mr. A and Mr. B face serious charges under the Capital Markets Act for operating an unauthorized investment market, in addition to running an illegal gambling site. Authorities also booked a further 138 people without detention, including 23 site operators responsible for distributing the platform and 115 participants who engaged in the gambling activity.
The Home Trading System investigation revealed the financial scale of the operation to be significant. Mr. A allegedly sold his fraudulent HTS software to Mr. B’s group for a profit of around KRW 3.4 billion (approximately $2.5 million USD) and collected monthly usage fees ranging from KRW 5 million to KRW 7 million.
Subsequently, Mr. B’s network disseminated the program to approximately 20 local partners nationwide, generating an estimated KRW 27 billion (approximately $20 million USD) through illicit bets linked to legitimate overseas indices such as the Nasdaq and Hang Seng.
Participants in the scheme were required to deposit a minimum of KRW 300,000, with some individual wagers reaching up to KRW 400 million. Investigators also uncovered evidence of internal fraud, noting that some site operators would expel players who achieved large profits in order to limit payouts.
Authorities acted decisively to seize assets, securing KRW 200 million in cash and luxury watches from Mr. B’s residence, and placing preservation orders on an additional KRW 1.9 billion in assets, including property and vehicles.
Police are also pursuing the confiscation of KRW 1.2 billionfrom Mr. A’s software company. A police spokesperson confirmed that investigations into illegal platforms posing as legitimate investment services will continue, advising the public to remain vigilant against such fraudulent schemes.
