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.
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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