Eight Days, One Fake Site, and 71 Wallets Lighter: Seoul Cops Wrap "Flare" FXRP Clone

A cloned Flare Network staking portal drained 3.4 million XRP — worth 12.3 billion won ($8.5 million) — from 71 investors over just eight days in October, according to Seoul police who have now wrapped the case for prosecution. Two men, both 29, face aggravated fraud charges, local outlet Chosun reported Thursday; a 34-year-old paid stand-in who appeared in promotional YouTube videos was also charged, and a fourth 29-year-old suspect is overseas under an Interpol Red Notice. None of the four has been tried, and police have not publicly named them.

The site, Fxrpntwork.com, impersonated Flare Network and its FXRP token, both legitimate projects, and promised monthly returns of 1.5% to 1.8% with principal guaranteed. Investigators said victims were directed to move XRP off domestic exchanges, through overseas venues, and into wallets the group controlled before the site went dark on October 23 and the operators vanished. The scheme surfaced just one month after FXRP's actual launch, and police said the group seeded online searches with planted portal blog posts, online news articles, Wikipedia edits and the stand-in's videos so any due diligence appeared to confirm the project as real. Average losses ran 173 million won ($119,000) per victim across the week the site was live.

Police froze 17.3 billion won of assets across overseas exchanges once the scheme was detected, after an overseas exchange tipped them off last October about a spike in staking fraud. Another 10 billion won moved during the probe and remains unaccounted for, putting the total investigators traced through wallets tied to the group at 27.3 billion won ($18.8 million) — well above the 12.3 billion won in confirmed losses from the 71 known victims, a gap police say signals additional unidentified victims. Investigators executed 54 search and seizure warrants, arrested one suspect at a hideout after he returned from abroad, and took the others into custody in sequence.

South Korean authorities have moved through a string of crypto cases this year, including June's charges against 23 people over laundering $11.1 million in USDT for a Cambodia-based phishing ring, and investigators said they would treat crypto fraud with "zero tolerance." Police urged investors to verify project domains and official channels before transferring funds to any staking scheme, a routine the fake Fxrpntwork.com page was specifically engineered to pass.

Separately, SEC Chairman Paul Atkins said on CNBC Monday that the agency is "ready, willing, and able to come out with rules" covering crypto markets and will "stand ready to provide that" if Congress fails to pass the Clarity Act, noting that "statute is the way to future-proof something" and the market needs "the certainty of a statute" so the framework does not shift with each administration. In other legal news, three Bitcoin ($BTC) holders sued Apple in the Northern District of California on July 24 over a counterfeit Sparrow Wallet app they say drained a combined $1.8 million, bringing eight counts including fraud and negligent misrepresentation.