The Taiwanese virtual currency market has recently been rocked by a major scandal involving “ACE Elite Exchange,” which has been exposed for engaging in large-scale fraudulent activities. This incident has not only shocked the entire blockchain and cryptocurrency industry but also highlighted the legal and ethical risks involved in virtual currency trading.
According to reports, the New Taipei City Criminal Investigation Brigade conducted a raid on ACE Elite Exchange, revealing the fraudulent gains of the former head of the exchange, a man surnamed Pan, and his partner, a man surnamed Lin. (Note: The current head of ACE is Wang Chenhuan, who took office in September 2023 and is also the managing partner of Jianye Law Firm.)
*At the time of publication, it was reported that withdrawals were still functioning smoothly.
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Police seize Lin’s fraudulent gains of NT$100 million
Social media as a tool for fraud
Police crackdown and legal action
Statement from ACE Exchange
The police discovered over NT$100 million in cash at Lin’s residence, with a total of illegal gains seized estimated to be around NT$200 million. According to police investigations, over the past three years, they deceived over a hundred investors through false advertisements, causing them to invest in worthless virtual currencies.
Lin was accused of using social media platforms such as Instagram and Facebook to publish investment advertisements, using clever rhetoric to induce investors to purchase worthless virtual currencies such as MOCT (Magic Coupon Coin), NFTC, and BNAT. They claimed that these currencies would be listed on well-known domestic and international exchanges and fabricated dreams of quick wealth, thereby increasing investors’ trust in these currencies.
The New Taipei City Criminal Investigation Brigade revealed that those involved misled investors into believing that these virtual currencies were the latest technological products with the same potential for appreciation as Bitcoin. However, in reality, these so-called investments were nothing more than the purchase of “garbage coins” and “air coins” whose value quickly disappeared, resulting in significant losses for investors.
ACE Exchange launched the MOCT trading pair in 2019.
The police searched a total of 15 locations in Taipei, New Taipei, Taichung, including the company premises of ACE Elite Exchange, and arrested Lin, Pan, and 14 other individuals (according to ACE Exchange, none of them are ACE employees). At Lin’s residence, the police seized a large amount of cash and virtual currencies, totaling over NT$200 million. The police estimate that the fraudulent amount by Lin’s group over the past three years may exceed NT$1 billion. Currently, Lin, Pan, and their associates are facing charges of fraud, money laundering prevention, banking law violations, and other offenses.
This incident serves as a reminder to investors to exercise caution when investing in the virtual currency market and remain vigilant against overly glamorous investment promises. As the investigation progresses, more details are expected to be revealed in order to bring justice to investors.
ACE Exchange stated to Chain News:
“Regarding today’s media reports on ACE, it is because certain listed currencies in 2019 were involved in illegal activities. Basically, ACE is cooperating with the investigation as a witness. Some media reports that employees of the company are involved are not true, and we have sent letters to the media for clarification. Since President Wang Chenhuan took office in September 2023, he has been committed to the legality and compliance of the exchange. In the case of suspected criminal activities, we will fully cooperate with the investigation and, according to regulations, delist controversial currencies.”
Below is the official statement from ACE:
1. ACE is committed to prioritizing user asset security with 100% NT dollar trust and cryptocurrency double protection.
ACE Elite was founded in 2018 and registered in Taiwan. It is the first Taiwan exchange that KPMG Anhou Jianye has guided to comply with domestic AML regulations. In 2021, it submitted a statement of compliance with the Anti-Money Laundering Act to the Financial Supervisory Commission, and it also has dual insurance, “Cathay United Bank’s 100% NT dollar deposit trust” and “CYBAVO cryptocurrency wallet system” through Nord Insurance Brokers to protect customer cryptocurrency asset custody. Since Wang Chenhuan took office as ACE President in September 2023, he has also been the managing partner of Jianye Law Firm, committed to legality, compliance, and the protection of user asset security as the top priority, and strictly abides by relevant laws and regulations in our country.
2. ACE regularly reviews the development of listed cryptocurrency projects and market trading conditions to provide users with more diverse choices.
ACE Exchange continues to monitor the development and market trading conditions of all listed cryptocurrencies to provide users with a good trading environment and service quality. ACE Exchange regularly implements market review processes and will continue to conduct comprehensive evaluations of past applications for listed currencies. Tokens that do not qualify will be delisted, and popular tokens will be added gradually to provide users with more diverse choices. If the projects have private placements and sales by offline teams other than on the ACE platform, users are advised to pay special attention. (※Risk reminder: The listing and delisting of currencies have been approved by ACE, but it does not mean that there are no investment risks. Cryptocurrency assets are high-risk investments, and investors should choose targets carefully, read white papers and other public information, and be mindful of investment risks at all times.)
3. If there are disputes and violations by project parties, ACE will fully cooperate with investigations and immediately delist to protect users until disputes are resolved.
As of January 8, 2024, at 16:00 (GMT+8), the MOCT/TWD trading pair will be delisted. After delisting, all pending orders will be automatically canceled, and subsequent listing and withdrawal functions will not be affected. Please be sure to handle your assets within the aforementioned period.
ACE will fully cooperate with investigations into specific disputes and violations by project parties, which have not had any impact on ACE’s operations. We will operate more cautiously in the future, strive to maintain a strong position in the Taiwanese market, and look forward to embracing the bull market with our users!
Best regards,
Wang Chenhuan, ACE Exchange President, and the team
ACE
MOCT
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