South Korean Crypto Exchange Komid Executives Imprisoned For Faking Trading Volume

Crime, News | January 22, 2019 By:

Two executives of South Korean crypto exchange Komid have reportedly been imprisoned for faking exchange volumes.

Local media outlet Blockinpress reported that the exchange’s CEO, Hyunsuk Choi, received a three-year sentence, while the firm’s in-house director, Park Mo, was sentenced for two years in jail. The two were accused of misconduct, fraud and embezzlement.

In January 2018, Choi and Park reportedly created a number of fake accounts on the exchange and fabricated millions worth of fake transactions using trading bots to convince investors that the Komid platform was doing more business and trading than it actually was. According to the report, around 5 million fake transactions were made to inflate the prices of crytocurrencies listed on the platform, which brought in $45 million in fees.

“Choi has repeatedly committed fraud for many unspecified number of victims for a long period of time,” the judge said. “The defendant blames the financial authorities for failing to repent of the mistakes and is transferring responsibility.”

In May 2018, South Korean authorities raided the offices of cryptocurrency exchange Upbit, which is owned by developer Dunamu, for allegedly faking its balance sheets and deceiving investors. In December, two senior executives from Dunamu and one Upbit employee have been indicted, but not detained, as part of an investigation into the proceedings.