South Korea authorities recently sentenced top executives of V Global, a cryptocurrency exchange, for defrauding investors. Mr.Yang and Mr. Oh were sentenced to eight years and three years in jail, respectively.
Court documents also revealed four other unnamed executives got five years of probation and three-year sentences. However, three of the six have yet to be imprisoned since they asserted their innocence to specific accusations and have the right to legal representation.
The latest court action now takes the number of arrested V Global executives to seven. Earlier, the exchange’s CEO, Mr. Lee, was sentenced to 22 years in prison for being the crime’s mastermind.
What was their offense?
According to reports, V Global promised investors returns of 300%. The exchange, which ran from July 2020 to April 2021, demanded that new customers open accounts and deposit an initial sum of about 6 million Korean Won with a reportedly guaranteed return of 18 million.
V Global attracted approximately 50,000 investors within its first year of business by guaranteeing consumers a commission of 12 million won.
In a statement, a judge of the 12th Criminal Division of the Suwon District Court said that during their investigations, the defendants interfered with processes, even destroying evidence to evade responsibility.
Many victims reinvested the money they received from their previous investments, so the amount of damage was lower than the amount legally defrauded.
The majority of the over 50,000 victims were middle-aged or older citizens searching for a “safe life after retirement,” according to V Global Invest Legal Counsel, Daegun Law Firm. The law firm has since revealed that at least one victim had committed suicide after being scammed.
South Korea has been hard on crypto
In September 2021, South Korea Financial Services Commission (FSC) began cracking down on non-compliant local crypto exchanges.
The development led to the shutting down of several ramps, placing investors at risk of losing assets worth over $2.5 billion.
The South Korean financial watchdog and its other allies, on Sep. 28, 2022, highlighted the need to create an internationally consistent regulatory framework against cryptocurrencies.