Case Overview: ACE Exchange Former Head Arrested
On January 4, 2024, Taiwan's prominent cryptocurrency exchange "ACE ACE Fiat-to-Crypto Exchange" former head, surnamed Pan, and his partner, surnamed Lin, were arrested on charges of criminal fraud, money laundering, and banking law violations. A total of 14 individuals were transferred for prosecution. The New Taipei City Criminal Investigation Corps seized NT$111.52 million in cash from Lin's residence and approximately NT$108 million in crypto assets from ACE's office, totaling illicit proceeds exceeding NT$200 million. Police estimate the duo's fraudulent gains over three years could surpass NT$1 billion.
Fraud Tactics: Social Media Ads and 'Air Coins'
According to police, Lin placed investment ads on Instagram, Facebook, and X, luring victims into purchasing cryptocurrencies such as MOCT, NFTC, and BNAT by promising imminent listings on well-known domestic and foreign exchanges for quick profits. Pan allegedly used ACE Exchange as the listing platform for these fraudulent coins, exploiting the brand's credibility in Taiwan. Investors were deceived into buying "junk coins" or "air coins" that later plummeted in value or became illiquid. The scheme exploited information asymmetry: hype around blockchain technology, comparisons to Bitcoin's past gains, and claims of professional trading teams—all to make victims believe these coins had real value.
Industry Warnings: How to Identify Exchange Listing Risks
ACE Exchange issued a statement clarifying that the case involves a specific coin issuer from 2019 and that ACE is cooperating as a witness. It emphasized that under new president Wang Chenhuan (since September 2023), the exchange has focused on compliance and has delisted the disputed tokens. However, the incident highlights vulnerabilities in exchange listing due diligence. Earlier the same month, Honghan Creative was fined NT$500,000 by the Financial Supervisory Commission (FSC) for operating a crypto business without completing anti-money laundering compliance. These cases offer key lessons for investors: verify if an exchange holds proper regulatory compliance statements; avoid coins that promise guaranteed high returns; research project teams thoroughly; and choose platforms with strong due diligence processes. Regulators in Taiwan are stepping up enforcement, and investors are advised to stay vigilant against “get-rich-quick” narratives.