South Korean ‘Bogus Crypto Exchange’ Fraudster Jailed

Legal South Korea

Author

Tim Alper

Author

Tim Alper

About Author

Tim Alper is a British journalist and features writer who has worked at Cryptonews.com since 2018. He has written for media outlets such as the BBC, the Guardian, and Chosun Ilbo. He has also worked...

Author Profile

Share

Copied

Last updated: 

January 20, 2024

Why Trust Cryptonews

Cryptonews has covered the cryptocurrency industry topics since 2017, aiming to provide informative insights to our readers. Our journalists and analysts have extensive experience in market analysis and blockchain technologies. We strive to maintain high editorial standards, focusing on factual accuracy and balanced reporting across all areas - from cryptocurrencies and blockchain projects to industry events, products, and technological developments. Our ongoing presence in the industry reflects our commitment to delivering relevant information in the evolving world of digital assets. Read more about Cryptonews

A South Korean court has sent an individual who provided a bogus crypto exchange with illegal bank documents to prison for four years.

Per Busan Ilbo, Judge Kim Jae-yoon of Changwon District Court sentenced an unnamed individual “in their 30s” following a fraud conviction.

The criminal, referred to in the South Korean media as A for legal reasons, worked with “gang members” on the project.

The court heard that A supplied the gang with bankbooks in the name of third parties using stolen identity data.

The gang, the court heard, created a fake exchange that duped citizens into investing over $112,000 in the platform.

A provided the gang with several bankbooks, as well as official public certificate documentation and one-time passwords (OTPs) linked to company accounts.

The gang members posed as middle managers of their bogus crypto exchange, and the court heard that they targeted “victims who had suffered stock investment losses.”

S Korean Crypto Scammers ‘Targeted Stock Market Traders Who’d Made Losses’

The fake exchange officials told investors they could recoup their lost funds by joining others in a recovery program.

By using tokens on the platform, investors were told, they would be able to recoup their former losses.

However, the court heard that the coins traded on the platform turned out to have “no substance.”

And the illegal bank documents allowed the gang to give their project a veneer of authenticity, prosecutors explained.

In sentencing, the judge said that A’s guilt was “severe” because the individual had “played an important role” in the scam. Judge Kim concluded:

“The damages are considerable, and [A] does not appear to be truly remorseful for these crimes.”

Earlier this month, police concluded a 16-month manhunt for a civil servant who allegedly stole some $3.5 million from a nursing fund.

Police think the man, surnamed Choi, converted the money to crypto before fleeing the country to live in a “luxury resort in the Philippines.”