Bithumb Founder Acquitted of Fraud Charges, Dodges Jail Time

Bithumb founder Lee Jung-hoon, who was on trial for allegedly defrauding $70 million, was declared not guilty and dodged a hefty jail sentence.

Local media reports confirmed that the executive was acquitted and dodged a potential sentence of up to eight years. On Jan. 3, 2023, the Seoul Central District Court, presided over by Judge Kang Gyu-Tae, ruled that Lee was not guilty.

Prosecutors Clear Lee of $70M Charges

The prosecutors had alleged that Lee stole $70 million from Kim Byung Gun. Kim amassed wealth as the head of the cosmetic surgery conglomerate BK Group. However, he decided that he wanted to diversify his business interests. Thus, he was said to have bought a stake in the South Korean exchange Bithumb.

The agreement was that Lee would issue a BXA token to finalize the deal. Kim reportedly paid him an upfront fee of $70 million at this time. Despite Lee receiving Kim’s payment, the anticipated token listing never happened, per the allegations.

The deal in question dates all the way back to October 2018.

Bithumb in the News

As per the translated statement, the exchange said, “We respect the court’s ruling,”

“Bithumb is operated under a system of professional managers, and former Chairman Lee Jeong-hoon is not involved in the management of Bithumb,” the exchange added.

Ordinary investors who believed the BXA cryptocurrency would trade on Bithumb also lost out on the failed transaction. Investors who had experienced significant losses, as a result, had also filed a complaint against Lee and Kim for fraud. Kim was accused of combining a portion of the down payment with the pre-sale of BXA.

However, Lee’s alleged deception during the negotiation allowed Kim to avoid any sanction from the authorities. Prosecutors rejected the assertions that Lee and Kim had planned the sales together. They concluded that Kim was likewise the victim of Lee’s fraud.

Bithumb has been in the news multiple times, including when it was one of the South Korean exchanges that national authorities had targeted for alleged connections to Terra’s Do Kwon.

A purchase arrangement between FTX and the South Korean exchange was also said to be under discussion months before FTX went out of business.

Disclaimer

BeInCrypto has reached out to company or individual involved in the story to get an official statement about the recent developments, but it has yet to hear back.

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