A group of Chinese migrants has been arrested for swindling over 4,600 other Chinese migrants out of billions of won in a fraudulent multilevel investment scheme.

Busan Metropolitan Police Agency’s International Criminal Investigation team on Monday said it had arrested a 42-year-old naturalized citizen from China and booked without detention 10 others for fraud and violating fundraising law.

The suspects are accused of taking 3.2 billion won ($3 million) from 4,612 Chinese migrant wives in South Korea, offering high-return investments, from April to July last year.

According to police, the suspects falsely advertised that they were operating a finance company in a partnership with a well-known Canadian firm and attracted investors through a popular chat service.

The victims were told that by investing in the financial items they would receive 2 percent dividend yields, three times a week, for up to 264 percent yield in a year. The suspects also enticed victims by offering to pay them in cryptocurrency if they invited other investors.

Receiving orders from a leader based in China, the suspects here opened chat rooms with 50 to 500 people to advertise their program and managed the investors, police said.

After collecting the investment money, the suspects sent 600 million won to China via bank transfer, WeChat Pay and Alipay, and split 2.6 billion won among themselves, according to police. The police added that the investors’ money had not been reinvested into other companies.

“Such a large number of victims occurred because the average amount of investment was not large -- 700,000 won -- and the victims were mostly afraid that they would face difficulties in obtaining Korean citizenship or cause their families trouble if the investment fraud was reported,” an official from the police said.

By Jo He-rim (herim@heraldcorp.com)