The Seoul Metropolitan Police Agency has charged the chairman and two senior executives of the cryptocurrency exchange Coinbit with fraud, according to Newspim.
According to investigators, from August 2019 to May 2020, the top managers falsified documents and used a wash trading strategy to inflate trading volumes.
The scheme involved creating two wallets on the exchange: the first was used for trades with fictitious accounts, and the second handled operations with lesser-known tokens. As a result, the organisers could earn more than 100 billion won ($85 million).
On 26 August, the Seoul police conducted searches at Coinbit’s offices on suspicion of inflating trading volumes by 99%. At the time, among the potential suspects was the company’s owner, Choi Mo.
In 2019, the CEO and executive director of the South Korean crypto exchange Komid were sentenced to prison for falsifying trading volumes. Authorities say 5 million transactions were fabricated on the platform, earning the management $45 million.
Earlier, Komid’s top executives attempted to appeal the verdict, but in August 2020 the court rejected their appeal.
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