Executives of Korean Exchange Sentenced to Jail for Indices Volumes

Two executives of a South Korean cryptocurrency exchange have been sentenced to jail due to bilateral trading volumes on their own exchange. The group allegedly employed a bot to fake large orders in equally cryptocurrencies and Korean won.
Two executives of South Korean cryptocurrency exchange Komid were sentenced to jail on Thursday “due to their purposes in orchestrating deceptive trading volume accounts on their own platform,” The News Asia reported.

The crime has ruined customers’ confidence in the digital currency market and has had a negative effect on the domestic digital currency trading marketplace.

Komid started operations on Jan. 5 last year after beta test runs. As stated by the court, Choi generated over five bogus accounts in January this past year and inflated trading amounts in the cryptocurrencies and Korean won on his exchange. The two were sentenced to prison “for fraud, embezzlement, and misconduct,” The News Asia mentioned, elaborating:
This is the very first time that the representative of a digital currency market was sentenced to prison for allegedly inflating trading amounts.

Cryptocurrency exchanges have been captured using trading bots to falsify orders because the first days of Mtgox. In December this past year, officials of one of those country’s largest crypto exchanges, Upbit, were fined for fraud. They allegedly faked orders worth roughly $226 billion and sold 11,500 BTC to about 26,000 investors. Upbit has denied the allegations.

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Among those executives is the CEO of the market, Choi Hyunsuk. He received a prison sentence while another executive obtained a two-year jail sentence, Maekyung book detailed, asserting:
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But, Edaily noted that the judge took into consideration the simple fact that the damage was lessened as some funds were returned. Moreover, he found that “The defendants did not appear to have perpetrated a crime with powerful fraudulent intentions. ” Nonetheless, he concluded:
Additionally see: Indian Supreme Court Moves Crypto Hearing, Community Calls for Positive Regulations

Released at Sun, 20 Jan 2019 04:00:48 +0000
Other domestic crypto exchanges in a similar gap include Coinnest, whose executives were indicted in September last year for accepting a bribe. Moreover, employees of crypto exchange HTS Coin were arrested in September last year on suspicion of fraud and embezzlement.

The fees against prosecutors outlined a strategy wherein the two defendants fabricated 5 million transactions on their platform to fool investors into believing that the volume was natural. This resulted in the two earning about $45mil. There is also a suspicion that they utilized a ‘bot’ to automatically create massive orders, which brought new users.

The judge explained that “Choi has given fraud for thousands of victims for a lengthy period of time,” the news outlet conveyed. “There is a need for punishment because the damage brought on by the invention of false electronic records is large,” Maekyung quoted him as saying.