Against the backdrop of the $70 million fraud allegation, the former chairman of the South Korean cryptocurrency exchange Bithumb, Lee Jung-hoon, faces 8 years jail term if found guilty of the allegation levelled against him as per report.
The court hearing of the case has been postponed to Dec. 20 while the investigation continues. It was gathered that Jung-hoon engaged in a $70 million fraud connected to a negotiation transaction with Kim Byung Gun, Chairman of the cosmetic surgery company BK Group.
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In Octobre 2018, It was revealed that Byung Gun was swindled while he made an attempt to buy exchange.
Gun revealed that he made a payment of $70 million to Jung-hoon as a form of down payment towards acquiring Bithumb with the condition that Jung-hoon will help list a token called BXA sponsored by the Blockchain Exchange Alliance.
Thereafter, the proceeds from the token listing coupled with the capital will be used to acquire the crypto exchange. Surprisingly, Gun maintained that Bithumb didn’t list the token and the fund was never refunded.
Meanwhile, Jung-hoon’s counsel contended that the case is simply a typical stock sale contract and should be left out of litigation.
In another development, Jung-hoon has been indicted in the $40 billion monumental loss of the Terra ecosystem but didn’t show up in court during the Oct. 6 hearing.
Bithumb’s Moments of Ups and Downs
This is not the first time that the South Korean based Cryptocurrency exchange, Bithumb, will be dragged into controversies. Recall that the exchange was charged for leaking users data when it was hacked in 2017.
This was also in connection with violating the law on managing information networks and the law on information protection. This subsequently prompted the largest crypto exchange in South Korea to launch AML Compliance.
Meanwhile, Jung-hoon is yet to admit or exonerate himself as regards the latest fraud charges against him. He was only reported to have pleaded sorry in the court for making it difficult for employees.
