Thailand crypto scam prompts government probe

The Department of Special Investigations (DSI) in Thailand has launched an investigation into an alleged cryptocurrency scam, following complaints from a number of victims with losses in excess of THB75 million (US$2.46 million).

The alleged pyramid scheme known as Khung Nong Cryptocurrency Trading became popular with investors in 2018. The scheme has pledged returns in the order of 8% per week, duping countless unsuspecting individuals into parting with their money.

According to Bangkok Post, the scheme has largely affected those living in the south of the country, with numbers of people in Krabi, Trang, Yala, Pattani, and Narathiwat selling assets to invest—including land, vehicles and businesses.

In a classic pyramid scheme structure, those promoting the scheme promised returns of THB8,000 (US$263) per week for every THB100,000 (US$3,286) invested. As a result, the scheme quickly grew in size, attracting growing numbers of victims through a team of recruiters.

Having started in October 2018, the scheme came to an abrupt halt in February 2019, citing a downturn in the economy as the reason it could no longer pay out to its investors.

The case was taken up by human rights activity Phadungsak Tienpairoj, who referred some 20 victims to the Department for Special Investigations. The DSI agreed to take up the investigation, in conjunction with law enforcement in Krabi province.

The scheme is thought to have affected large numbers of victims across the region, with the DSI investigating reports that victims lost millions of baht to the scam.

Noopad Wachedi, from the Koh Lanta district of Krabi was among the victims. She reportedly pledged her land in order to raise money for the investment, at which point she was issued with a cheque from the scheme which subsequently bounced.

According to Noopad, the recruiters had told her the scheme was overseen by state officials. A relative was also drawn into the scheme, and similarly lost money to the alleged fraud.

The deputy director of the Bureau of Illegal Financial Business Crime, Police Captain Thas Laothawee, said the complaints had been received, and would now be investigated by the DSI.