Executives who helped the bogus crypto exchange V Global dupe some 50,000 customers out of some $1.4 billion will not go to jail.
A South Korean court instead handed the three unnamed individuals suspended sentences. It issued fines, despite conceding they had caused “astronomical damages.”
The South Korean newspaper Seoul Shinmun and the news agency Yonhap reported on September 14, that the Criminal Division of the Daejeon District Court’s Cheonan Branch passed judgment on three individuals convicted of violating the Act on the Aggravated Punishment of Specific Economic Crimes.
The presiding judge sentenced all three of the officials to three years in jail (suspended). The court also ordered them to serve five years of probation.
The trio’s names were withheld for legal reasons. The court also ordered the first individual, referred to as A (a 61-year-old woman), to pay a 660 million won ($474,000) fine.
The judge also ordered B (63, also female) to pay a 426 million won fine ($306,000). A man identified as C (aged 57) was ordered to pay 259 million won ($186,000).
V Global Crypto Exchange: Fines, Suspended Sentences, and Probation Orders
The trio, prosecutors told the court, occupied top positions in organizations that used multi-level marketing methods. They were tasked with luring customers to the V Global platform.
Their efforts earned them up to 1.5 billion won ($1.1 million) each in profits, prosecution officials told the court. In sentencing, the presiding judge said:
“The defendants caused astronomical damage by exploiting popular interest in cryptoassets. Over 50,000 victims are still living with the economic and mental pain of this crime. The damage done to society is considerable. A strict punishment is called for.”
But the judge added that the executives did ensure that some of the victims received payouts and the “profits” they had been promised.
The Supreme Court jailed Lee (given name withheld for legal reasons), the CEO of V Global, for 25 years for masterminding the fake exchange back in 2023.
A Veneer of Authenticity
The CEO and his staff created a realistic-looking trading platform, designed to resemble bona fide South Korean exchanges like Upbit and Bithumb.
The platform featured real-time price charts for coins like Bitcoin (BTC) and Ethereum (ETH), as well as coin tickers and realistic-looking trading volume tables.
The V Global exchange used a “tiered membership system” that incorporated advanced multi-layered marketing methods.
Its operators offered members payouts in V Global-branded tokens if they “recruited new members.”
But the courts later determined that these coins were just as fake as the exchange itself, and had never launched on any blockchain protocol.
South Korean courts have also jailed other senior V Global executives. One individual is currently serving a 14-year sentence. Another, meanwhile, is coming toward the end of a four-year jail term.
V Global launched in mid-2020. But the rouse began to unravel in 2021, when disgruntled customers filed legal complaints, stating that they could not withdraw their assets from the exchange.
At its height, the bogus exchange operated from a building in the heart of Seoul’s busy commercial district.
The district is home to some of the country’s biggest crypto exchanges and most prominent blockchain technology startups.
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