Between October 2010 and December 2013, a scam called ForexnPower operated in Bayside, New York, targeting members of the Korean language-speaking community residing in Queens. The scammers have been ordered to pay $835,058 in restitution to the victims they defrauded over the course of those years, along with $1,627,245 in penalties. That adds up to around $2.46M.
Let's take a look at how this Forex scam worked and what we can learn from it. Understanding how other people were defrauded is a great way to steer clear of those same pitfalls and stay safe as you are trading Forex.
Safety Capital Management Inc. and GNS Capital Inc. operated as ForexnPower
There were two defendants in the 2018 ForexnPower criminal case:
- Tae Hung Kang, a.k.a. "Kevin Kang." This individual was the founder and Chief Executive Officer of Safety Capital Management, Inc. ("Safety Capital").
- John Won, who was the President of GNS Capital Inc. ("GNS") and the Vice President and Secretary of Safety Capital.
The 2015 civil action by the CFTC also named Sungmi Kang as a defendant. She was a controlling person of Safety and GNS. Ultimately, the civil case against Sungmi was dismissed due to her death. When we refer to "Kang" in this article, we are discussing Tae Hung Kang.
It is worth noting that Won was registered with the CFTC as an associated person and branch manager of a registered introducing broker between August 2013 and February 2014 (the final months of the scam, and a couple of months after). The GNS also registered with the CFTC as a CPO/CTA in October 2013. So, merely being registered with a regulatory agency is not enough on its own to guarantee someone is safe or trustworthy.
How the ForexnPower scam worked
At the start of the scam, the defendants began placing advertisements in Korean language newspapers and on Korean language radio. They started hosting seminars and distributing pamphlets, and they also created an email list.
Advertisements for ForexnPower included phrases such as:
- "Easy trading method anyone can learn"
- "Secret trading method for generating more than 10% monthly profit"
- "Target $100,000 with $500 starting money"
- "Manage your account safely while you're asleep or not home"
- "Make $1 million and more within three to five years"
During the seminars, Kang and Won claimed they were expert Forex traders. They told their audience they would "learn the 'know how' to enjoy the life of comfort lounging on the beaches of the Bahamas and Hawaii ... in a year or two, or two to three years at most." Kang even stated he didn't believe that any of their investors would lose so much as a single dollar.
The scammers claimed they had a special computerized trading system they referred to as a "Super Power Bot" or "ASET" that would make the victims rich.
In truth, Kang and Won were not expert traders, and did not have a sophisticated bot or strategy. They lied about their profit record. In fact, their bot produced losses.
The investors paid 2% monthly fees. On occasions where the accounts did produce profitable trades, ForexnPower took a 30% cut.
In addition, Safety Capital sold unlisted stocks to investors, saying they would use it to trade, which would result in large returns. Instead, they misappropriated the money. At least 50 people fell for the ForexnPower scam. They collectively lost over $845,000.
As investors began losing money, they contacted ForexnPower to complain. The scammers responded by saying they had an insurance program would reimburse them along with a potential 10% in profit. But they said that the only way the victims could receive this reimbursement and potential profit was to keep their money invested for a minimum of one year.
Later down the line, the scammers made other excuses and played for more time. They said that they would start using a new system called "Skepler," which would generate 20-30% monthly returns. This was another lie, of course.
How the scammers were caught
As mentioned previously, GNS registered with the CFTC as a CPO/CTA in October 2013. The CFTC served an administrative subpoena for GNS documents in April 2014, which never received a response from GNS beyond an acknowledgment of receipt from Won. This triggered an investigation into GNS.
As to what triggered the subpoena in the first place, we found no public information. The NFA was investigating FX Evolve, which acted as an introducing broker for FXCM, where ForexnPower held their trading accounts. But whether this investigation into FX Evolve led to their interest in ForexnPower and GNS is unknown.
While not the initial trigger for the investigation into ForexnPower, at least one of the investors also reached out to the authorities to bring attention to the situation. This CFTC press release from September 8th, 2022 references a specific customer who was offered a "lifetime opportunity" by Kang, and who then tried to request a withdrawal after investing.
Kang told the customer that he couldn't process the withdrawal right away because they didn't have sufficient funds to pay out. But he said they could do it in several weeks because another client was expected to invest. That is exactly how Ponzi schemes operate. So, he pretty much indirectly admitted the scam to the investor with that statement. The customer's case became supporting evidence for the Ponzi accusation.
The CFTC filed a civil case against Kang and Won in 2015. Criminal charges were filed against them in 2018 by federal prosecutors.
ForexnPower entities have been ordered to pay more than $2.4 million in restitution and penalties
On March 13, 2026, the CFTC announced that the US District Court of the Eastern District of New York had entered a default judgment against GNS and Safety Capital. The court ordered Kang, Won, GNS and Safety Capital to pay $835,058 in restitution. They also ordered GNS to pay $186,102 in penalties, and ordered Safety Capital to pay $1,441,143 in penalties. At the end of this press release, the CFTC mentions that if the defendants have insufficient funds or assets, there is no saying whether the victims will be able to recover their money or not through restitution.
We would like to take a moment to point out that this case took a really long time to reach this final judgment. Remember, the scam started in 2010, and ended in 2013. It took more than a decade for the court to order restitution. The victims have been waiting all this time while struggling to recover their lives after their losses.
Kang and Won received prison sentences
Kang pleaded guilty to securities fraud conspiracy in March 2021, and was sentenced in December 2021 to two years in prison. Won was convicted in November 2021 of securities fraud, wire fraud, money laundering conspiracy, and substantive securities fraud. In September 2022, he was sentenced to one year and a day in prison.
What can we learn from the ForexnPower scam?
Reading through this article, it may appear obvious that ForexnPower was making unrealistic promises to investors. Here are some of the red flags from their advertisements and claims during their seminars:
- Exaggerated language and sense of urgency, e.g. "lifetime opportunity."
- Emphasis on effortless wins and a luxury lifestyle (lounging on the beach while the money rolls in).
- Get-rich-quick language, like claiming that investing $500 today would result in being a millionaire in just a few years.
- At times suggesting that the investors wouldn't lose any money at all. Nobody can realistically claim to have a perfect strategy that guarantees no losses.
It's tempting to think that anyone who would miss all these red flags is stupid. But that isn't how scams generally work. Con artists structure their schemes in ways that exploit a range of vulnerabilities. That way, even generally intelligent people who usually make rational decisions may sometimes fall into their traps. Let's discuss a little more about how this works.
Members of minorities can be especially vulnerable
Kang and Won targeted the Korean diaspora in Queens. As members of the Korean-speaking community, they had insights into the lives of community members and their struggles. They were able to communicate with those community members in Korean, which deepened the sense of trust and connection they were trying to build.
Some of these Korean-speaking community members did not speak fluent English, which served to isolate them, increasing their vulnerability. The scammers deliberately chose to host their seminars in Korean, but not to translate risk disclosures into Korean.
It is also common for immigrants and minorities to have work and financial struggles, especially if English is not their first language.
So many people in Queens face financial hardships that this is not even the only major Forex scam that has targeted a minority group living there.
Haitian citizen Eddy Alexandre scammed the Haitian community through his platform EminiFX. As chaplain at the Maranatha Seventh-day Adventist Church in Queens, he was a trusted community leader, which gave him even more of an edge.
Community trust can be exploited
Picture how it must have felt to a struggling, Korean-speaking resident of Queens to hear there was an easier way to make money. Imagine receiving that seemingly good news from members of one's own community. The victims likely didn't think they would be betrayed by people who truly understood their struggles.
Moreover, as word started to get around, referrals likely got involved. Victims would have heard about ForexnPower from their family, friends and neighbors. They might have believed that if they heard about Kang and Won from people they trusted, that they must be well-intentioned and capable investment managers.
Emotional decision-making can be irrational
The success of con artists does not hinge solely on finding people who are too foolish or slow to be aware of what a red flag looks like. It relies on redirecting people's attention so that the red flags just don't jump out at them as much.
Put yourself in the state of mind of someone who is desperate to solve their financial problems. There may come a moment when you are more motivated to believe there is a way out than you are to examine potential red flags. You are just trying to survive emotionally.
Your brain might "turn down the volume" on concerns like get-rich-quick language or unrealistic claims. Meanwhile, it might bring in messages of hope and relief loud and clear.
That was likely the mindset of the victims of the ForexnPower scam as they listened to Kang and Won's seminars or read their pamphlets.
Unfortunately, this tends to be a lesson a lot of people learn the hard way, because your rational mind can know better, but you can still fall for a scam if your emotions are too loud. This can even happen more than once, as many victims of scams are also susceptible to "recovery" scams.
Final takeaways
The ForexnPower scam was a particularly nasty case in that it involved scammers conning members of their own vulnerable community. The slow, drawn-out legal response left the victims without justice for over a decade. And even now, it isn't clear whether the funds will be recoverable.
At its core, ForexnPower worked the same as other Forex cons: it exploited trust and desperation, resulting in investors overlooking red flags at great cost.
In the moment, it can be hard to make smart financial decisions when you are desperate. Make a rule for yourself that you will take your time, even and especially when someone is giving you an urgent pitch. And remember, even members of your own community can be taken in by scams, or be scammers themselves.
