Bithumb's Owner Found Not Guilty of Fraud (Report)

Bithumb's Owner Found Not Guilty of Fraud (Report)

The Seoul Central District Court has reportedly ruled that the owner and former chairman of the South Korean cryptocurrency exchange – Lee Jung-hoon – did not defraud Kim Byung-gun of 112 billion won ($87.5 million).

If he had been found guilty, he could have faced a prison sentence of up to eight years.

The final word of the court

According to a local report, the 34th Division of the Penal Agreement of the Seoul Central District Court found Lee not guilty of the charge of violating the Aggravated Punishment of Certain Economic Crimes (Commission of Fraud) Act.

Authorities ruled that he did not embezzle over $87 million from BK Group Chairman Kim Byung-gun during negotiations to acquire Bithumb in 2018. Judge Kang Gyu-Tae stated:

“It cannot be accepted that the proceeds of stock trading were alienated due to an error caused by fraudulent acts, such as the prosecution's case, based solely on the evidence presented by the prosecution.”

Bithumb – which is among the leading cryptocurrency exchanges in South Korea – said it respects the outcome of the litigation.

“Bithumb is operated under a professional management system, and former chairman Lee Jeong-hoon is not involved in the management of Bithumb at all,” the company added.

Prosecutors previously insisted that Kim prepaid the sum as a “contract fee” to acquire the Korean trading venue, while Lee assured that Bithumb would list BXA tokens and use capital from the sale of the assets for the deal. However, the coin was not issued by the platform but by the Blockchain Exchange Alliance and the agreement collapsed.

The death of Park Mo

The court ruling comes less than a week after Park Mo was found dead near his home in Seoul. The South Korean was vice president of Vidente, Bithumb Holdings Co.'s largest shareholder.

Initial investigations determined that Park's death was a suicide. However, some doubted this version as he was under investigation for stealing funds from Bithumb-affiliated companies and manipulating stock prices.

The platform also had a close relationship with the fallen crypto giant FTX. While the latter expressed intentions to purchase in the summer, the liquidity crisis and the possible application for bankruptcy protection thwarted such plans.

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