By South Korean authorities recently arrested suspects behind a crypto ponzi scheme by utilising artificial intelligence (AI), as per an article by local English-language news outlet Korea Joongang Daily.
The ponzi scheme, which allegedly managed to steal around 21.2 billion won ($18.3 million) over a six-month period in 2018, came to a halt after the Seoul Special Judicial Police Bureau for Public Safety trained robots to catch the suspects by using keywords as well as other clues.
Hong Nam-ki, section chief of the bureau’s second investigation team, told the publication:
“Through keywords such as Ponzi, loan and recruiting members, we were able to teach the AI patterns of Ponzi schemes.The program can also identify advertisement patterns and identified the enterprise in question, which [was caught] with evidence provided by an unnamed informant.”
The CEO’s behind the scheme, known only as Lee and Bae, managed to acquire notable sums of cash by the selling of private digital tokens known as M-Coins and by the collection of membership fees from would-be recruits as per the report from the Korea Joongang Daily.
As is the norm with malicious crypto schemes, Lee and Bae took advantage of the general public’s lack of knowledge about the cryptocurrency arena in order to steal their fiat funds from them.
Hong Nam-ki added:
“In our stakeout, we saw that most people attending the swindler’s presentation for membership were elderly people in their 60s and 70s.”
Despite the increasingly positive legitimacy of the crypto and blockchain ecosystems, Ponzi schemes continue to be a thorn in the side of the industry.
Earlier this year, Bulgarian authorities also caught the masterminds behind OneCoin, which was a notorious international quasi-pyramid scheme which was in operation for many years and also promised its unknowing investors massive returns.
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