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South Korean Crypto exchange CEO: 22 years in prison for $1.7 billion fraud

Forkast, a news source in South Korea, says that seven executives at the V Global exchange were found guilty on Friday of stealing more than $1.7 billion in crypto. They were sentenced to prison and fined a lot of money.

V Global, an exchange, worked like a Pyramid Scheme. Investors had to deposit 6 million won ($5000) to get a 300 percent return (Return on Investment). And it said it would give back 18 million won in its own cryptocurrency, V Cash.

When the exchange was running the crypto fraud, they said that V Cash would be better in the future. As a result, investors now expect to make more money from their investments because of this.

In addition, it was giving anyone who brought in a new investment 1.2 million won as a reward. Some investors also said that they had some of the promised returns, but officials said that the money came from new hires and was just passed on.

Han Sang-jun, a lawyer at a South Korean law firm, said that;

There were a lot of cases where a family member or a close friend recommended [V Global] to another.

A lot of people had a lot of fun when the V Global scandal came to light. Prosecutors wanted life in prison for anyone found guilty of this marketing scheme, but today’s court rulings called for milder punishments that were still impressive. The company was sued by several people who didn’t get what they deserved from this marketing scheme.

22 years in prison and 106 billion won ($89 million) in fines were given to the CEO, Lee Byung-gul, who was behind the crypto fraud.

The remaining six criminals were punished by the court based on how much they were involved in the crypto fraud. People can be jailed for up to 14 years and fined up to $89 million, which is $2 million and $2.3 billion.

People in South Korea say that punishment isn’t fair because of the damage caused by crypto fraud.

Han said that the punishment isn’t as bad as some people thought it would be because they spent all of their money. The report says that about 52,400 people lost their money.

Most of the victims were middle-aged or senior citizens who dreamed of a stable life after retirement.

In the same way, a professor of information security at Dongguk University said that the punishments don’t match the damage. People who break the law in these kinds of cases could get up to 90 years in prison, just like US states take economic chaos very seriously, he said.

In cases like these, the stolen money is usually hidden somewhere unknown,  and scammers do not take it seriously to pay back their civil liabilities, so the victims remain victims.

A man who lost money to an exchange called V Global took his own life because he didn’t get his money back.

As time goes on, crypto crimes are becoming more common. However, authorities have recently punished some crypto fraudsters.

Nine people were sentenced to 10 years in prison in Abu Dhabi for defrauding 18 million dirhams, or about $4.9 million, in a scheme that used crypto to make people rich quickly. This is just one example.

Disclaimer: These are the writer’s opinions and should not be considered investment advice. Readers should do their own research.

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