Korean Altcoin Issuer Arrested on Accusations of $16.1m Fraud
A South Korean altcoin issuer has been apprehended by the Virtual Asset Crime Joint Investigation Team of the Seoul Southern District Prosecutors’ Office on March 19, on charges of fraud. The individual, who remains unnamed, is accused of defrauding investors of $16.1 million. This arrest comes after a failed attempt by a crypto market maker to escape by sea in December last year.
The suspect, identified as Jon Bur Kim, also known as Park, aged 42, was intercepted by Coast Guard officials as he tried to flee to China on a fishing boat from Jindo on December 20, 2023. However, due to a storm, the boat was forced to dock at Mokpo, foiling his escape plan. Park, who had gained a significant following on social media by flaunting his collection of luxury sports cars, is currently in custody and undergoing trial at the Haenam Branch of the Gwangju District Court. He is facing charges of illegally manipulating coin transaction prices, including bribing crypto exchange employees to artificially inflate prices.
Prosecutors allege that between February 2021 and April 2022, Park collaborated with the arrested token issuer to launch and promote fraudulent cryptocurrencies, commonly known as “scam coins.” They are accused of using deceptive practices such as false data disclosure and market manipulation to convince investors of the legitimacy of their coins.
The prosecution also suggests that the duo may have engaged a “coin listing broker” to facilitate the listing of these coins, which resulted in rapid price surges, allowing them to sell their holdings for significant profits. The case against Park includes investigating his potential involvement in the crimes attributed to the unnamed token issuer as authorities continue to uncover the extent of their collaboration. This incident is part of a broader trend of increased scrutiny against altcoin issuers in South Korea, as concerns grow over the proliferation of scam coins and the involvement of celebrities in controversies related to low-cap altcoins.
In a separate development, U.S. prosecutors announced on March 8 their plans to appeal a Montenegrin high court ruling regarding the extradition of Do Kwon, the former CEO of Terraform Labs, to South Korea. This legal battle involves multiple countries, including South Korea and the United States, both of which are seeking Kwon’s extradition in connection with the $40 billion collapse of the Terra ecosystem. Kwon is facing charges of fraud and market manipulation in the U.S., while South Korea has also charged him with fraud and violations of capital markets laws. Kwon’s legal team prefers his extradition to South Korea, citing proximity to his family and the potential for a 40-year prison sentence.
