A fraudster is exploiting frugal Korean-Americans who are looking to avoid paying transaction fees when exchanging their money from the South Korean won to U.S. dollars. One victim has reportedly lost $50,000, after obliging to the fraudster’s website posting that was disguised as an advertisement for currency exchange.
The victim, a 40-year-old Irvine-resident identified only by her initial A, wanted to send her sister in Korea $46,000, all of which she now lost in a con job by the fraudster.
“Missy USA [online discussion forum for Korean-Americans] is often used for people to exchange currency,” she said. “I found a man who said that he’s looking to send money to the U.S. from Korea, so I trusted him, but he took my $46,000 and disappeared.”
In a separate case, an L.A.-resident also lost $6,000 in a similar fraud. “I’ve exchanged currency with another person on the website before, so I was trying to do the same this time. Little did I know, the person took my money and fled,” she said.
The under-the-table currency exchange has long been a common form of transaction among Korean-Americans and native Koreans. In most cases, the person wishing to exchange the U.S. dollars to the won looks for someone who can personally transfer the money to South Korea.
People who use the service choose it over regular wire transfer at the bank to save transaction fees (between $20 to 30). It is also used by those who want to avoid leaving official records of their transactions.
As evidenced by the cases mentioned above, the under-the-table exchange obviously poses a great risk.
It was later found that the two victims were presumably conned by the same man, who disguised himself as Jong-hoon Lee and Ji-hoon Nam for each of the cases.
The two victims both testified that the man they met after the initial contact on Missy USA appeared to have been in his late 20s, around 5-foot-8 in height and skinny in stature, while also wearing glasses.
Advertisements for currency exchange on various online communities for Korean-Americans are immensely common, but those within the international money transfer business stress that such under-the-table deals are extremely dangerous.
“Personal transactions to exchange currency is highly risky,” said one employee at an international money transfer business in Koreatown. “It’s hard to understand why anyone would hand over money to someone they’ve met for the first time, but the reality is that such incidents continue to happen. It doesn’t make any sense.”
Furthermore, the South Korean consulate office also advised that making monetary transactions through an unofficial route should be done at one’s own risk. Also, violating the Foreign Exchange Transactions Act could result in imprisonment of up to three years or a fine of 200 billion won in South Korea.
By Hyoung Jae Kim