Key Takeaways
- Seoul Eastern District Court Criminal Agreement Division 12 found Shin guilty on multiple counts, including fraud and falsification of records.
- Prosecutors allege the trio misappropriated $830 million worth of crypto from thousands of users over three years.
In a significant turn of events, Jinwook Shin, the CEO of Bitsonic, once a prominent player in South Korea’s crypto scene, has been slapped with a seven-year prison sentence for his role in a fraudulent scheme.
Bitsonic, which was once a leading cryptocurrency exchange, abruptly halted its operations back in 2021, citing both internal and external issues. Fast forward two years, and Shin found himself facing serious charges brought forth by the government.
According to recent reports from local media outlets, the Seoul Eastern District Court Criminal Agreement Division 12 didn’t hold back, finding Shin guilty on multiple counts, including fraud and falsification of records.
The judge underscored how Shin, leveraging his position within the exchange, manipulated transaction volumes to create a false sense of activity, deceiving investors in the process.
The court’s investigation unearthed a troubling pattern of behavior. Between January 2019 and May 2021, Shin masterminded a scheme to artificially pump up the trading volume and price of Bitsonic Coin.
His tactics included using the exchange’s funds to purchase its own token and even fabricating cash deposits to give the illusion of financial health. Moreover, Shin went as far as to make false announcements about partnerships to lure unsuspecting investors.
Ultimately, Shin’s actions led to substantial financial losses for investors, to the tune of approximately 10 billion won ($7.5 million). Consequently, the court handed down a severe sentence: seven years behind bars.
The fallout from Shin’s misdeeds didn’t stop there. Bitsonic’s VP, also implicated in the case, received a one-year prison sentence. The closure of Bitsonic in August 2021 left investors reeling, unable to retrieve their funds.
Adding fuel to the fire, on February 6, the Seoul Prosecutors Office arrested Shin and two other executives of Haru Invest, another crypto platform that had suspended withdrawals the previous year. Prosecutors allege the trio misappropriated a staggering $830 million worth of crypto from thousands of users over a three-year period.
In South Korea, where crypto exchanges must obtain operating permits and partner with domestic banks to facilitate fiat transactions, cases like Shin’s serve as stark reminders of the risks investors face in an industry still grappling with issues of fraud and accountability.
