The latest court action brings the total number of V Global executives behind bars to seven, after the CEO was previously sentenced to 22 years in prison.
Six executives were sentenced to up to eight years in prison for their roles in the $1.5 billion (2 trillion won) South Korean crypto exchange fraud V Global, but three were not detained so they could fight certain charges in court.
V Global ran from July 2020 to April 2021, attracting approximately 50,000 investors by promising 300% returns as well as sizable payments for referring new customers.
According to a translation of Dec. 26 reports from South Korean media outlets such as Economist.co.kr, two high-ranking executives named Mr. Yang and Mr. Oh were sentenced to eight and three years in prison, respectively, for their roles in defrauding investors.
Another four unnamed executives were sentenced to three years in prison and five years on probation.
Three of the six have not yet been detained because they have claimed innocence and have the right to defend themselves in court.
“The defendants only trusted the VGlobal management team, avoided responsibility, and once the investigation started, they destroyed evidence and interfered with the investigation,” said the judge from the Suwon District Court’s 12th Criminal Division.
The judge, on the other hand, was said to have been lenient with the defendants because the actual amount of fraud and number of investors affected was lower than initially thought last year.
According to Kyeongin’s February reporting, this was due to later evidence indicating that approximately 10,000 investors had received returns from V Global through payments from multilevel marketing incentives such as customer recruitment bonuses. Many are said to have re-invested their profits before the platform was shut down.
It was claimed in June of last year that the company had paid out $1,000 customer referral bonuses to existing investors via the influx of capital from new users in a Ponzi-like fashion.
The latest court action brings the total number of V Global executives behind bars to seven, after the CEO, known as Mr. Lee, was sentenced to 22 years in prison in February.