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Crypto Exchange Chief Arrested in South Korea for Alleged Multi-Million Dollar Fraud

1 min
Updated by Kyle Baird
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In Brief

  • The CEO of a major virtual asset exchange was arrested in South Korea for an alleged multi-million-dollar scam.
  • The Vice President of the exchange also faces charges, including obstruction of business, but without detention.
  • The scam allegedly started in January 2019 and involved the artificial inflation of prices and volume.
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The CEO of a prominent virtual asset exchange was recently arrested in South Korea, who allegedly participated in a crypto fraud scheme involving over 10 billion won (approximately $8 million).

Based on local reports, he faces charges ranging from forgery to violating other criminal provisions. Reports also indicate that authorities have indicted the Vice President of the exchange for obstruction of business charges.

The cyber vertical of the prosecutor’s office in Seoul arrested 40-year-old Bitsonic CEO Jinwook Shin. The prosecution claims that the scam dates back to January 2019. The exchange’s CEO allegedly started manipulating computer systems to artificially inflate the prices of certain cryptocurrencies and their trading volumes.

This crypto fraud reportedly continued until May 2021, months before the exchange officially ended operations.

Read more: 15 Most Common Crypto Scams To Look Out For

The executives also allegedly used overseas businesses formed on paper to artificially create higher volumes.

Based on the translated statement by the prosecutor,

“Shin tried to artificially increase the price of self-issued cryptocurrencies by manipulating the system computer and using cross-trading by taking advantage of the fact that he is both operating a virtual asset exchange and issuing cryptocurrencies.”

The exchange’s deficit made Shin use around $8 million worth of cash and virtual assets in a turn-around transaction. The prosecution’s investigation also revealed the exchange’s Vice President interfered with normal cryptocurrency trading by creating and running a special program.

The prosecution’s inquiry reportedly began in September 2021 and eventually revealed the dubious operations.

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Shraddha Sharma
Shraddha is an India-based journalist who worked in business and financial news before diving into the crypto space. As an investment enthusiast, she has also has a keen interest in understanding crypto from a personal finance standpoint.
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