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Illegal XRP Exchange Operator Sentenced to Jail in South Korea
An illegal XRP exchange operator has been sentenced to jail for eight years in South Korea after duping investors out of almost $3.4 million. The unnamed operator stole almost $2 million of the total from one individual, prosecutors explained in a trial at the Seoul High Court.
Illegal XRP Exchange Told Customers it Had a Deal With Ripple
The court upheld the verdict of a Seoul District Court. This court earlier sentenced the operator to 12 years in jail. However, the High Court judge ruled that the operator had taken steps to compensate one of their victims, and so reduced the sentence accordingly. The operator can now accept the verdict or appeal the judgment at the Supreme Court.
Background of the Case
- The accused became the CEO of a “domestic cryptocurrency exchange” in 2015.
- The exchange “advertised” that it had “signed a formal supply agreement with” the XRP token issuer Ripple and Ripple Labs.
- An individual referred to as B (for legal reasons) sent the exchange fiat worth around $2 million in 2015.
- The CEO convinced B to keep the coins on the exchange’s platform.
Fraudulent Activities and Victims
In 2017, the exchange told B that he could boost his XRP holdings. The CEO also duped another investor, named D by the court, by trading XRP for Bitcoin. Some victims suffered enormous damage through no fault of their own, as police were unable to recover most of the lost coins and fiat.
Legal Proceedings and Escape Attempt
Witnesses testified that the CEO had tried to convince them to make false statements absolving him of guilt. The CEO then tried to escape justice by requesting a postponement of the sentencing date and asking for time to compensate for the damage. When judges granted his requests, he took the opportunity to skip bail and go into hiding, before he was eventually rearrested two years later.
Legal Consequences and Precedents
In sentencing, the presiding High Court judge emphasized the lack of remorse shown by the defendant and the serious disregard for the law, leading to the need for severe punishment. This case adds to a series of legal actions against fraudulent activities in the cryptocurrency space in South Korea.
Ian is a cryptocurrency enthusiast blending humor with professionalism. With an engineering background and a storyteller's heart, he simplifies the blockchain world with sharp analysis and a touch of wit. At Cryptowire, he brings his unique perspective to make digital financial innovation accessible to all.
