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Crypto exchange Bitsonic executives jailed for $7.5M theft: Report

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The CEO of crypto exchange Bitsonic has reportedly been sentenced to seven years in prison, while the firm’s technology chief was sentenced to one year in jail for stealing $7.5 million (10 billion South Korean Won) worth of customer deposits.

On Feb. 6, South Korean media outlet Yonhap News reported a Seoul District Court sentenced CEO Jinwook Shin to seven years in prison. He was arrested on Aug. 7, 2023, and charged with fraud, forging and falsifying records, and obstructing a business via computer.

Bitsonic’s vice president of technology — reported only as Mr. A — was sentenced to one year in jail on a charge of obstructing a business via computer.

The court said trust in crypto exchanges “has been greatly damaged” by Shin and Mr. A, adding that the pair were “avoiding responsibility and showing no remorse.”

Bitsonic CEO Jinwook Shin was sentenced to seven years prison. Source: X

It added a “significant amount” of customer funds had not been recovered.

The court said that between January 2019 and May 2021, Shin manipulated transaction volume on the exchange by using Bitsonic’s funds to buy the exchange’s own token, artificially inflating its price.

He also entered fake South Korean Won into the exchange’s system to make it appear as though he had deposited cash. Mr. A also created a program that purchased the cryptocurrency held by Shin in a bid to inflate prices on the exchange.

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Shin also posted a fake notice on Bitsonic that it had partnered with another international exchange.

The scheme collapsed when investors could not withdraw their cash and crypto as Shin siphoned $7.5 million in customer funds.

Bitsonic closed operations in August 2021, claiming it had “internal and external issues.”

Meanwhile on Feb. 6, Seoul’s Prosecutors Office arrested the CEO and two other executives of the crypto yield platform Haru Invest which suspended withdrawals in June last year.

Prosecutors alleged the trio stole $830 million (1.1 trillion Korean won) worth of crypto from 16,000 users, misappropriating most of the funds by reinvesting them between March 2020 and June 2023.

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