South Korean authorities have taken in the chairman of the nation’s leading crypto exchange, Bithumb, to investigate him of alleged fraud and embezzlement suspicions.
As announced by news agency Yonhap News, the Seoul Metropolitan Police Agency intelligence unit has selected to question Lee Jung-hoon. He’s the chairman of the Board of Directors of holding company Bithumb Holdings and Bithumb Korea. This is after two raids on the exchange’s headquarters and other offices earlier this month.
Both Lee (44) and Kim Byung-gun (57), chairman of the BK Group, have been sued by investors of multiple frauds and embezzlement offenses regarding the failed listing of the BXA token, a coin whose value has dropped from over USD 5 to less than USD 0.30.
Lee and Kim have attempted to distance each other from the listing fiasco, claiming the blame lies solely with the other party.
Nevertheless, earlier this week, Kim’sKim’s lawyers stated that police had seized a large portion of Lee’sLee’s shares in Bithumb Holdings.
Lee is thought to be the de facto chief of Bithumb, which is yet to explain the story and has not responded to a CNWN request for clarification.
Investors have also blamed Lee of violations of the Act on Aggravated Punishment for Specific Economic Crime – stating that he may have attempted to embezzle investors’investors’ funds in overseas property purchases or offshore investments. Police are also investigating Lee on suspicion of violating this law.
An obscure shell company based in the British Virgin Islands is thought to have played a crucial part in the case. South Korean Investors appealed their case to the Seoul authorities earlier this year.
The police have not yet called Kim in for interrogation and did not indicate whether they would seek to do so later.