South Korea Raids 3 Crypto Exchanges Over Money Embezzlement Allegations


The Seoul Southern District Prosecutors’ Office of South Korea raids 3 Crypto exchanges over money embezzlement allegations. The local news media reports state that the exchange staff along with the executives, are suspected of siphoning off money from customer accounts.

16 March, AtoZForex Prosecutors in South Korea have reportedly raided three cryptocurrency exchanges this week. The raids were carried out in relation to the suspicions that employees have misused funds from customers’ accounts.

South Korea Raids 3 Crypto Exchanges Over Money Embezzlement Allegations

The local news media reports state that the exchange staff along with the executives, are suspected of siphoning off money from customer accounts. In addition, they are suspected of using these funds buy cryptocurrencies through other exchanges. The Seoul Southern District Prosecutors’ Office has reportedly confiscated mobile phones, hard drives, and other documents for the purpose of finding the evidence. One of the prosecutors was quoted as saying:

“The firms turned up on our radar in January during our investigation of suspicious money transfers between Bitcoin exchanges that were detected during an audit by the Financial Services Commission and the Korea Financial Intelligence Unit.”

Another online report states that the exchanges have been now taken over by the financial regulator of the country, the Financial Services Commission (FSA). Also, the reports mention that the operators of the companies are being charged with embezzlement.

South Korea Cryptocurrency Position

The news appears amidst heightened scrutiny of cryptocurrency businesses in South Korea. Recently, the country has moved to clamp down on the criminal financial activities that involve cryptocurrency.

This January, the Financial Supervisory Service has reportedly stated that it was probing possible insider trading of cryptocurrencies by its own staff. The same month, according to the Korea Customs Service, saw a total of 637.5 billion won on foreign currencies that have been exchanged illegally. This includes unrecorded capital outflows via cryptos.

Back in September 2017, the initial coin offerings (ICOs) market was banned in South Korea. However, the recent reports suggest that officials might be softening their stance. The new reports from the South Korean local media suggest that the ban can be lifted partially. This would imply that token sales that meet certain conditions will be allowed in the country.

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