A Korean American man in San Francisco has been found guilty of running a cryptocurrency investment fraud scheme, defrauding investors of millions of dollars.
According to the U.S. Attorney’s Office for the Northern District of California, a federal jury convicted Jae Woo Kim, 32, of New York, on 14 counts of wire fraud and money laundering on February 26.
Kim, who moved to San Francisco in October 2017, operated his scheme until June 2020, swindling investors and acquaintances out of more than $7 million in cash and cryptocurrency. He falsely claimed to be a cryptocurrency investment expert, promising victims that he would invest on their behalf and generate profits.
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“This case may involve the new world of virtual currency, but there’s nothing new about the defendant’s scheme to defraud,” said Acting United States Attorney Patrick D. Robbins. “Douglas Kim made bogus promise after promise to investors and lenders, only to cheat them and send their money to offshore gambling sites. Today’s verdict sends a clear message to anyone who engages in fraud in the Northern District of California: you will be prosecuted, and you will face serious consequences.”
Faces Decades in Prison
In October 2017, Kim approached an investor and borrowed $1 million, claiming he would return the money with interest through cryptocurrency investments. However, he spent the funds on an overseas Bitcoin sports betting site. The U.S. Attorney’s Office stated that one month later, Kim borrowed another $186,000 in cryptocurrency from a different victim, again squandering the money. In total, he defrauded the same victim of more than $500,000.
By July 2020, Kim had conned multiple victims, including nine who testified in court. In 2023, while he was out on pretrial release, Kim allegedly renewed his scheme to defraud. One count related to this renewed period of fraud remains pending.
Kim’s sentencing is scheduled for June 25. Each wire fraud and international money laundering charge carries a maximum sentence of 20 years, while money laundering convictions carry a maximum of 10 years per count.
BY YOUNGNAM KIM [kim.youngnam@koreadaily.com]
