Korean crypto exchange executives sentenced to jail for falsifying trading volumes
Two executives of the South Korean cryptocurrency exchange Komid were sentenced to jail this week “for their role in preparing fraudulent reports on trading volumes on their platform.” Writes about this The News Asia.
The CEO of the exchange, Choi Hyunsuk, received 3 years in prison, and the second defendant in the case – 2. “This is the first time that representatives of the virtual currency exchange were sentenced to prison, presumably overstating the volume of trading,” the publication says..
Komid went live in January last year. According to the publication, Choi created more than five fake accounts during the launch phase and used them to inflate trading volumes in both cryptocurrencies and the Korean won. He was charged under the articles for “fraud, embezzlement and malfeasance”.
“Prosecutors described a scheme in which two defendants fabricated 5 million transactions on their platform to trick investors into thinking the displayed trading volumes were real. The organizers of the scheme earned about $ 45 million on this. They are also suspected of using a “bot” to automatically create large applications that attracted users, “writes The News Asia.
The court noted: “Choi committed an act of fraud against countless victims. The conviction is due to major damages caused by the creation of falsified electronic records. “.
Edaily reports that the court took into account the fact that the damage was minimized by returning part of the funds. “The defendants appear to have committed this crime without clear fraudulent intentions,” the judge said. “However, as a result, customer confidence in the virtual currency exchange was undermined, and the domestic virtual currency market was negatively impacted.”.
In December last year, similar charges were brought against the leadership of one of the largest exchanges in South Korea – Upbit. They allegedly faked about $ 226 billion in trading volume, which allowed them to sell about 11,500 bitcoins to 26,000 investors. Upbit pleaded not guilty.
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