South Korean defrauds investors of $3.2M

Kim Bumjae, 55, director of Raon VN Company and Khanh Asset Company, and eight other accomplices will go on trial in Ho Chi Minh City on charges of fraud to appropriate property on May 23.

The trial is expected to last until May 29, summoning 156 victims and dozens of others involved.

According to the indictment, Kim was appointed by a compatriot as a representative of an IDS Holdings Company branch in Vietnam in early 2015.

Kim’s job was to call for investment and mobilize money from customers.

Under the agreement, he would receive 4% of the total amount raised as commission and the rest would be transferred to South Korea to invest in a forex business.

From April 2015 to October 2018, Kim established IDS Capital Investment Company Limited, IDS Holdings Investment Company, Raon Vietnam Ltd and Khanh Asset Company Limited to raise money illegally.

He was identified as the mastermind of the scheme and joined accomplices to organize foreign exchange classes to gain investors’ trust.

With a policy of paying interest from 1.5% to 1.8% per month, IDS Capital mobilized more than VND73 billion from 134 customers.

IDS Holdings Company raised VND91 billion from 224 customers.

Kim then liquidated contracts by paying principal and interest as the two companies made losses.

Kim founded other companies to continue raising money from investors.

For Raon Vietnam Co., Ltd., Kim and his accomplices raised more than VND490 billion through nearly 1,500 contracts. His company then liquidated more than 1,220 contracts worth more than VND357 billion.

Through Khanh Asset Company, the Korean director and his accomplices raised VND263 billion from 799 members and paid investors just VND16 billion.

To create trust, Kim initially paid full interest to investors, investigators said.

He never transferred the money he collected from investors to Korea but instead used the latter to pay interest and other expenses such as rental and system maintenance.

Kim also set up other business projects to raise money from investors through six companies, including a catering company, a poker project, a karaoke business, and a charter shipping company.

By the time of arrest in August 2020, Kim and his accomplices had appropriated more than VND76 billion from 156 investors. Kim was accused of personally possessing nearly VND40 billion.

According to investigators, other employees benefited by sums from VND270 million to VND2 billion.

The defendants confessed to their crimes during the investigation.