South Korean retail investors reported losing about US$250 million (S$318 million) to stock-related scams during the first half of 2026, as fraudsters took advantage of sharp market swings and growing interest in equities.
Police investigated 3,506 cases involving stock-tip chatrooms between January and June, with the schemes involving about 336 billion won. While the number of cases increased by 4.1 per cent from the same period last year, the amount of money involved rose by 19.8 per cent.
The scams emerged as South Korea’s KOSPI index enjoyed a strong rally during the first half of the year. The benchmark was the world’s best-performing major stock index during that period before subsequently falling as much as 44 per cent from its June 19 peak.
Financial fraud lawyers said scammers exploited investors’ fear of missing out on the rally, particularly among inexperienced traders looking for quick gains.
One common tactic involved leaving comments on videos posted by well-known brokerage analysts and financial influencers. Victims were then directed to private chatrooms where scammers posed as investment professionals and offered stock recommendations.
Some groups charged large subscription fees for supposed investment advice, while others persuaded members to transfer money directly for investments. In some cases, scammers used fake applications and impersonated employees of legitimate securities firms.
Police in Seoul said in June that they had arrested 10 people linked to a scam operation based in Cambodia that allegedly defrauded 59 South Koreans of about 9.9 billion won over two years.
The group allegedly posed as securities company employees and encouraged victims to invest in artificial intelligence-related stocks through fake investment applications. The case has been referred to prosecutors.
One victim, identified by the pseudonym Jay, said he lost 60 million won after joining an investment chatroom through a TikTok video. He initially received stock market commentary before being encouraged to invest larger sums based on claims of potentially substantial returns.
Jay eventually borrowed money and transferred additional funds after being told about a supposedly rare investment opportunity. The chatroom later shut down, leaving him with significant debts.
Authorities and financial institutions have faced growing pressure to address the spread of investment scams online. South Korea’s Financial Supervisory Service said it did not have separate data on illegal stock-tipping chatrooms and that investigations into such cases were handled by law enforcement.
As market volatility continues, lawyers warned that scammers could continue using rapid price movements and investor anxiety to attract victims. The cases highlight the risks faced by retail investors when investment advice comes through unverified online channels.
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