Prosecutors reportedly searching for an 8-year jail time period for Bithumb founder over $70 million fraud

South Korean prosecutors are reportedly searching for an eight-year jail sentence for the founding father of the Bithumb crypto exchange within the ongoing $70 million fraud case. 

The prosecution has justified the request to have the founder, Lee Jung-hoon, imprisoned on the grounds that the harm inflicted was important, South Korean outlet YNA reported on October 25. 

Lee, the de-facto proprietor of the trade, is accused of stealing hundreds of thousands of {dollars} from Kim Byung Gun, chairman of BK Group, whereas engaged on the acquisition of Bithumb. Notably, they collectively registered the BTHMB consortium and had been set to get a 50% stake within the trade.

Courtroom paperwork point out that Kim paid Lee $100 million as a “contract charge” after reaching a deal to handle the trade collectively following the acquisition. Moreover, particulars of the deal required Lee to listing the Bithumb Coin (BXA), which BK Group-linked Blockchain Change Alliance issued by means of Bithumb.

Failure to listing BXA token

On this case, the funds generated by means of the potential itemizing had been lined as much as cowl the remaining acquisition prices. Curiously, the token was by no means listed, leading to Kim pursuing authorized motion in 2020. As per the prosecution’s argument, Lee didn’t intend to listing the token terming it as a play to defraud his associate. 

On the identical time, victims who invested in BXA additionally sued Kim alongside Lee. Nonetheless, Kim was not charged with authorities contemplating him a sufferer. 

“The construction of this case is a typical inventory sale contract. Negotiations had been held for 90 days, and each the defendant and Kim are consultants, and legal professionals from regulation corporations had been concerned in each negotiations,” Lee’s legal professionals argued. 

Moreover, Lee’s legal professionals said that the deal was performed in good religion by Kim and took authorized motion to keep away from any felony duty. The sentencing listening to is about for December 20.

Terra collapse case

It’s price noting that the Bithumb case is among the many high-profile incidents dealing with the South Korean crypto scene. In the mean time, investigators are wanting into the collapse of the Terra (LUNA) ecosystem, specializing in founder Do Kwon. 

Notably, Kwon remains on the run after prosecutors issued a warrant towards him for alleged fraud within the collapse.