Taiwan prosecutors have charged 32 individuals with fraud and money laundering associated with ACE Exchange, leading to over 1,200 people losing a total of NT$800m ($24.56m). The indictments include founder David Pan, business partner Lin Keng-hong, and former chairman Wang Chen-huan. The suspects allegedly convinced investors to buy various tokens and promised to turn ACE Exchange into Asia’s leading crypto trading ecosystem. However, many investors were unable to convert their tokens back to Taiwanese dollars as promised, leading to complaints and a judicial investigation.
The suspects engaged in a two-pronged scheme to defraud investors by aggressively advertising tokens across various media channels and manipulating exchange prices. They allegedly sold tokens and blockchain products for over NT$2.2b ($72.54m) and directed others to conceal the money across various locations, including a real estate purchase in Yilan County. Prosecutors also accused Wang of receiving around NT$43m ($1.3m) and attempting to manipulate the market by putting NT$26m ($791k) back into the exchange to inflate token prices. Given the severity of the fraud and the number of victims, prosecutors recommended at least 20 years imprisonment for the core suspects and a minimum sentence of 12 years for Wang.
Earlier this month, authorities indicted Pan and six others for a separate crypto fraud case involving digital assets worth $10.7m. Pan established an offshore trading platform offering a crypto wallet service called “Alfred Wallet,” which enticed victims to deposit funds but then lost access to their money. The trading platform claimed that Pan was a former executive whose involvement in the exchange ended in 2022. These indictments underscore the extent of fraudulent activities associated with ACE Exchange and the significant financial losses suffered by victims.
The alleged fraud at ACE Exchange involved the sale of tokens such as NFTC, bitnature coins, and mochange, as well as the creation of white papers and other materials to make the scheme appear legitimate. The suspects’ aggressive promotion of these tokens and promises of turning ACE Exchange into a leading crypto trading platform attracted numerous investors who later found their tokens losing value. Complaints from investors who were unable to convert their tokens back to Taiwanese dollars led to a judicial investigation and the subsequent indictments of key figures involved in the exchange.
Prosecutors have recommended strict sentences for the core suspects in the ACE Exchange fraud cases, including founder David Pan, his business partner Lin Keng-hong, and former chairman Wang Chen-huan. The severity of the fraud, the significant financial losses suffered by victims, and the alleged attempts to manipulate the market warrant long prison terms for those involved in the fraudulent activities. The indictments highlight the need for greater oversight and regulation in the cryptocurrency space to protect investors from such schemes and ensure the integrity of digital asset trading platforms.
