South Korean police arrested three suspects behind a fake XRP staking platform that allegedly stole $19 million by impersonating Flare Network.
South Korean authorities have arrested three people accused of operating a fake XRP staking platform that allegedly stole 3.4 million XRP, worth about 12.3 billion won ($19 million), from 71 investors.
Investigators say the group impersonated the Flare Network ecosystem, promised guaranteed monthly returns, and used overseas crypto exchanges to move the stolen funds before disappearing.
According to the Seoul Metropolitan Police Agency, the suspects operated a fraudulent website, Fxrpntwork.com, between October 16 and October 23, 2025, targeting XRP holders with promises of fixed monthly returns of 1.5% to 1.8%.
Police arrested three suspects, including the alleged mastermind, while another suspect remains overseas. South Korean authorities have obtained an arrest warrant for the fourth individual and requested an Interpol Red Notice to support international efforts to locate and arrest him.
The suspects have been charged under South Korea's Act on the Aggravated Punishment of Specific Economic Crimes, which covers large-scale financial fraud.
Investigators allege the group convinced victims to deposit their XRP into wallets controlled by the scammers. Once the transfers were completed, the website went offline, and the operators disappeared with the funds.
The fraud succeeded because it looked connected to legitimate blockchain projects. Police said the suspects copied the branding of Flare Network and FXRP, making the platform appear to be an official XRP staking service.
The fake website was promoted through blog posts, online articles, and YouTube videos promising "principal guaranteed" and fixed monthly returns.
The scammers also exploited growing interest in earning passive income from crypto. While XRP does not support native staking, many investors are familiar with Flare's ecosystem, where XRP holders can access decentralized finance services.
Investigators believe the group used that familiarity to make the platform appear trustworthy.
Victims were instructed to transfer their XRP through overseas exchanges before depositing it into designated wallets, making the transactions appear more legitimate while reducing the chances of early detection.
Despite the scammers' efforts to hide the money trail, investigators were able to quickly follow the stolen funds.
Using blockchain analytics, IP tracking, domain registration records, and conversation logs, investigators identified wallets linked to the operation.
Police also found the suspects routed XRP through overseas exchanges to bypass South Korea's Travel Rule, which requires identity verification for crypto transfers above 1 million won.
Authorities executed 54 search and seizure warrants and tracked the stolen funds across multiple wallets. Investigators also confirmed that part of the XRP was sold through over the counter (OTC) traders before being converted into Korean won.
As of now, authorities froze about 17.3 billion won (around $12 million) worth of XRP and Tether on overseas exchanges within three days of detecting the fraud. Authorities are now working through legal procedures to confiscate the assets and return them to victims.
However, around 10 billion won (about $7 million) had already been moved before the freeze orders took effect and remains missing. Blockchain analysis also showed wallets linked to the scam processed nearly 27.3 billion won in crypto, suggesting the total scale of the operation was much larger than the confirmed victim losses.
Investigators are continuing to examine additional wallets, identify other individuals involved in promoting the fraudulent website, and trace funds allegedly laundered through OTC crypto brokers.
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