'The W25m came back like a miracle' — but voice phishing victims still live the nightmare

"Is this Kim So-yoon? This is the Seoul Metropolitan Police Agency Metropolitan Investigation Unit."

Kim So-yoon (pseudonym, 28) did not pick up when an unknown number called in August. After falling victim to voice phishing once, she had made a habit of ignoring calls from numbers she did not recognize. But the phone kept ringing, and something about the persistence felt different. She finally answered — and received unexpected good news: police had recovered 25 million won of the 40 million won ($29,400) she had lost.

The Seoul Metropolitan Police Agency Metropolitan Investigation Unit spent three years tracking down 1,137 voice phishing victims like Kim and returned about 26.37 billion won that had been frozen at virtual asset exchanges. Kim had grown so wary that she even suspected the police call of being a scam. She had once been confident she would never fall for voice phishing — a confidence that evaporated in a matter of hours, leaving her 40 million won in debt.

The Herald Business spoke with three victims who lost anywhere from tens of millions to as much as 800 million won to voice phishing.

The scammers alternated between fear and false reassurance to strip victims of their judgment, cut them off from the people around them, and then exploited the belief that money already sent could be recovered — driving losses ever higher.

"It took four hours from the first call to the moment I wired the money. At the time everything just rushed forward as if I were under a spell. Even now, thinking back on it makes me dizzy."

In June last year, Kim — a nurse working in Mokpo — answered an unknown call just before a night shift. The man on the line introduced himself as a prosecutor's office official and told her that a bank account opened in her name had been used in a crime.

Minutes later, a man posing as a prosecutor took over the call. He initially pressed her, insisting she was involved in criminal activity, but when Kim protested her innocence he shifted his tone: "You look like a victim — we'll help you." On the fake prosecution website the gang directed her to, her name, resident registration number and case details were all displayed.

The gang told her that verifying whether she was involved in criminal activity required an asset check, and instructed her to take out a loan. They claimed the funds would be held in a government-managed "safe account" and returned once the investigation was complete.

Learning that Kim worked at a children's hospital, they brought up child-rearing to build rapport while cutting her off from outside contact. They had her activate a new mobile phone and even demanded she screenshot her KakaoTalk messages with her boyfriend and send them over.

By the time Kim realized she had been scammed, the 40 million won was already gone. She spent more than a year working overtime and night shifts to pay off the debt.

Park Yo-sep (pseudonym, 70) was also deceived in May last year by a voice phishing gang whose members took turns impersonating a police officer, a Financial Supervisory Service official and a prosecutor. The rotating calls from people claiming to represent different agencies convinced him that a real investigation was under way.

They warned him that billions of won in criminal funds had passed through accounts in his name and that he could be detained, then told him he would need to pay a "deposit" to clear his name. "If you tell your family, they could be treated as accomplices," they said — so he kept it from his wife.

Park ultimately put up his apartment as collateral to take out a high-interest loan at around 14 percent annually, and after additional transfers his losses swelled to 850 million won. "I spent a full year doing nothing but borrowing and repaying more than 800 million won," he said. "I couldn't face my family. I was alive, but I wasn't really living."

Police recovered 43 million won for him, but returning to the life he had before the scam has not been easy. Park said he has struggled with deepening depression and still suffers from the aftereffects.

The gang took a different approach with Kim Jeong-suk (pseudonym, 49), a hagwon instructor in Daegu. Posing as a side-job opportunity, they won her trust by paying out small but real earnings in exchange for simple tasks — adding KakaoTalk friends and watching videos. Then they told her that a "mission error" had frozen her funds and demanded she deposit more. "Team members" in a group chat chimed in to reassure her: "I took out a loan to sort it out too."

While the first two victims were manipulated through fear of criminal involvement, Kim was targeted through anxiety about losing money she had already put in. Each additional transfer to recover her funds pushed her total losses to about 30 million won. Police efforts helped her recover 16 million won, but she is still working part-time at a hagwon and at a Coupang Inc logistics center to pay off the remaining debt.

"Police can tell it's a scam because we see these cases all the time, but when you actually get that call, you can't help but panic in the moment," a police official said. "Even if you've heard about the tactics in the news, you can still become a victim when it happens to you."

Last year, 23,360 voice phishing cases were reported, with total losses reaching 1.26 trillion won. The method used to siphon off stolen funds has been shifting from in-person cash collection to bank transfers. Last year, bank transfers accounted for 12,636 cases — 54 percent of the total — roughly double the 6,365 in-person collection cases, which made up 27 percent. In the first eight months of this year, bank transfers accounted for 4,937 cases, or 58 percent of the total.

More than a year passed. Just as hope of recovering the lost money was fading, the police called. Kim was not alone. One by one, others who had lost tens of millions to hundreds of millions of won and had been quietly absorbing the damage in their own lives received the same call. Kim So-yoon got back 25 million won, Park Yo-sep 43 million won and Kim Jeong-suk 16 million won.

Starting in September 2023, police worked with major domestic virtual asset exchanges to trace 1,050 digital wallet and exchange accounts and 163,000 bank accounts in a campaign to return stolen funds. Through that effort, about 26.37 billion won in voice phishing proceeds frozen at virtual asset exchanges was returned to its rightful owners.

Some of the stolen money had flowed through multiple bank accounts before landing at virtual asset exchanges. The exchanges had been freezing the relevant accounts upon confirming that stolen funds had entered them.

But while the money was frozen, there was no way to know who it should be returned to. At the time, virtual asset exchanges were not classified as financial institutions subject to victim relief procedures under the Act on Special Cases Concerning the Prevention of Loss Caused by Telecommunications-Based Financial Fraud. Banks could only notify exchanges that voice phishing proceeds had entered a particular account — they could not share victim information.

Police first identified the real-name bank accounts linked to the exchange accounts, then obtained warrants to trace the immediately preceding accounts, and from there worked further back through the chain of transactions. When criminal organizations had moved or split funds across multiple accounts, the same process had to be repeated each time.

Once investigators traced the money back to the account from which it had originally been sent, they cross-referenced past voice phishing reports and transfer records submitted by victims to confirm each victim's identity.

Finding the victims was not the end of it. At the time, there was no legal procedure to refund money frozen at exchanges directly, so police also had to obtain consent from the account holders to release the funds. Some holders were unreachable, incarcerated or overseas, and investigators had to track each one down individually.

Even when police called victims to re-verify past reports and transfer records, victims often suspected the call itself was a scam, forcing investigators to attempt contact multiple times as a matter of routine.

"There were so many people involved that the team had to find and contact each one personally," a police official said. "It doesn't count toward arrest statistics, but we felt from the outset that we had to see it through — so we kept at it alongside other investigations."

A significant portion of the regulatory blind spots that have made refunds difficult is expected to be resolved starting this month, when an amended version of the telecommunications fraud victim relief act takes effect. Under the revised law, virtual asset exchanges will be classified as financial institutions. Even when stolen funds have been transferred to an exchange, victim information can be shared, accounts suspended and refunds processed. Funds already converted into virtual assets will also be eligible for reimbursement.

However, if stolen funds leave domestic exchanges for private wallets or overseas exchanges, tracing and recovery remain extremely difficult — making prevention more important than ever.

"Once the money reaches an overseas exchange, recovery is in effect extremely difficult," a police official said. "If a victim personally purchases virtual assets and transfers them to another wallet, compensation can be nearly impossible."

"Now that the law has been amended, reporting quickly will significantly improve the chances of recovery," the official added. "Government agencies never ask you to send money. If you have sent money, the most important thing is to report it as fast as possible and get the payment suspended."

If you're thinking about self-harm or suicide, dial the Suicide Prevention Hotline at 109, available 24 hours a day, seven days a week. Please request a translator for English-language services.