Japan arrests two over $515,000 crypto scam run by fake police officers from Cambodia

Japanese police have arrested two people over a fake police scam that allegedly tricked a woman in her 40s into sending about $515,000 (81 million yen) in crypto. Investigators believe the network posed as Osaka police officers and operated from Cambodia, with confirmed losses tied to the suspects reaching about 240 million yen.

According to information cited by FNN, the fraudsters claimed that a separate case had resulted in losses of 600 billion yen and involved roughly 400 accounts allegedly used to launder money.

The woman was then allegedly told that she was at risk of arrest and needed to transfer funds to demonstrate her innocence.

Police believe the Yen crypto police scam ultimately resulted in the victim transferring cryptocurrency worth approximately 81 million yen, equivalent to about $515,000 based on the conversion cited in reports.

Investigators have not disclosed which cryptocurrencies were transferred or identified the wallets that received the assets.

The Tokyo Metropolitan Police Department believes Okayama and Minamisawa were involved in a wider organization. FNN reported that confirmed losses from cases linked to the two suspects have reached approximately 240 million yen.

The suspects have not been convicted, and the allegations remain subject to investigation.

Japan’s fake police scams generate billions in losses

The arrests come as Japan faces rapidly increasing financial losses from impersonation schemes involving people posing as law-enforcement officials.

The National Police Agency reported 5,422 fake police scam cases through July 2026, with losses reaching 61.71 billion yen. While the number of cases declined 6.4% from the same period a year earlier, the financial losses increased 25.7%.

The agency began recording fake police scams as a separate category in its 2026 statistics after the method became increasingly widespread.

Across all forms of special fraud, Japan recorded 210.81 billion yen in losses during the first seven months of 2026, representing a 42.9% increase from the corresponding period in 2025.

During the first half of 2026, fake police schemes alone generated 50.79 billion yen in losses. The average completed case resulted in approximately 11.64 million yen in losses.

The 81 million yen involved in the latest Yen crypto police scam was therefore significantly larger than that average.

Police have identified recurring tactics in these schemes. Victims may be told that they are under investigation, that an arrest warrant has been issued or that they must move money to prove they are not involved in criminal activity.

In another case reported on Sept. 25, a man in his 70s allegedly lost approximately 73 million yen after callers claiming to represent the Tokyo Metropolitan Police Department instructed him to move money to establish his innocence.

Authorities have emphasized that legitimate police investigations do not require individuals to transfer money to designated accounts.

Cryptocurrency adds another layer to fraud investigations

The latest Yen crypto police scam also comes as Japanese authorities strengthen oversight of cryptocurrency transactions connected to suspected fraud.

In August, Japan’s Financial Services Agency and National Police Agency asked cryptocurrency exchanges to consider measures including delays for withdrawals involving newly registered wallet addresses.

The proposed measures include additional transaction monitoring, stronger checks on newly added withdrawal addresses and restrictions when account activity appears inconsistent with a customer’s established behavior.

Authorities have also urged exchanges to strengthen phishing-resistant authentication and improve their response when police identify suspicious transactions.

The push followed a broader rise in fraud losses. National Police Agency figures showed 18,067 special-fraud cases and 151.47 billion yen in losses through May. Fake police schemes accounted for 40.32 billion yen of that total.

Japanese authorities have separately warned about cryptocurrency investment fraud. The Tokyo Metropolitan Police Department has reported cases involving victims who were approached through social media and dating applications before being persuaded to transfer cryptocurrency to fraudulent investment platforms.

In September, a woman in her 70s in Gifu allegedly lost cryptocurrency worth 39.29 million yen and another 2 million yen in cash after people posing as police officers and prosecutors instructed her to convert assets into cryptocurrency as part of a supposed investigation.

Such cases demonstrate how the Yen crypto police scam model can extend beyond conventional bank transfers, with cryptocurrency offering another mechanism for fraudsters to obtain and move victims’ assets.

Cambodia connection draws attention to overseas fraud networks

Investigators believe the organization involved in the Yen crypto police scam operated from Cambodia, more than 4,000 kilometers from Japan.

Japanese police suspect a Chinese national directed the operation from a Cambodia-based fraud center. However, authorities have not publicly identified the specific location or organization allegedly responsible.

The suspected overseas base reflects a broader regional problem involving fraud networks operating across national borders.

Japan arrested an alleged senior Prince Group figure in June while investigating activities connected to international fraud networks. However, the current case has not been publicly connected to Prince Group, and available reporting does not establish such a relationship.

Other Asian investigations have also uncovered Cambodia links in separate cryptocurrency-related fraud cases. South Korean police arrested 23 people in June over an alleged USDT laundering operation connected to a Cambodia-based phishing network. Investigators said the operation involved suspected laundering activity worth 16.8 billion won and more than 11,000 bank accounts.

Cambodia has also moved to strengthen penalties against people involved in online scam compounds and related organized criminal activity, with its Senate approving legislation in April.

For Japanese investigators, the Yen crypto police scam investigation now extends beyond the two arrested suspects. Authorities are examining the suspected Cambodia-based operation, the alleged Chinese director and the wider network believed to have generated approximately 240 million yen in confirmed losses across cases involving the suspects.

The investigation remains ongoing, and police have not publicly established how the 81 million yen in cryptocurrency was subsequently transferred, converted or withdrawn.