According to reports, the CEO of crypto exchange Bitsonic has been sentenced to seven years in prison, while the firm’s technology chief received a one-year jail term for embezzling 10 billion South Korean won ($7.5 million) worth of customer deposits.
On Feb. 6, Yonhap News Agency disclosed that the Seoul District Court handed down a seven-year prison sentence to Jinwook Shin, who was apprehended on Aug. 7, 2023. He faced charges of fraud, record forgery, and obstructing business operations through computer manipulation.
Bitsonic’s technology vice president, identified as Mr. A, was sentenced to one year in jail for computer-related offenses.
The court highlighted the severe erosion of trust in crypto exchanges due to the actions of Shin and Mr. A, citing their lack of accountability and remorse.
Between January 2019 and May 2021, Shin allegedly manipulated transaction volumes on the exchange by using Bitsonic’s funds to purchase its native token, artificially inflating its value. Additionally, he falsified deposits to create the illusion of cash influx into the exchange. Mr. A contributed to the scheme by creating a program that boosted cryptocurrency prices on the platform.
The fraudulent activities came to light when investors encountered difficulties in withdrawing their funds, revealing that Shin had misappropriated $7.5 million in customer assets. Bitsonic ceased operations in August 2021, citing internal and external issues.
In a separate incident on Feb. 6, the Seoul Prosecutors Office detained the CEO and two other executives of crypto yield platform Haru Invest. The platform had suspended withdrawals in June 2023 amid allegations of embezzlement.
Prosecutors accused the trio of embezzling 1.1 trillion won ($830 million) worth of cryptocurrency from 16,000 users by reinvesting most of the funds between March 2020 and June 2023.
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