Coinone CEO Probe Heats Up as Prosecutors Raid HQ Over $19.6M Loan

Zuid -Korean officers of Justice carried out a search on 30 September on September 30 for the places of work of Cryptocurrency Change Coinone after allegations that the CEO -executive abused enterprise funds. The workplace of the general public prosecutor of Seoul Southern District confirmed that researchers the headquarters of the Change and the Residence of CEO Lee Seong-Hyun in Yeongeungpo-Gu, Seoul, entered.

The case stems from a grievance filed by the Monetary Supervision Service (FSS), which accused Lee of it, received a mortgage of 27 billion ($ 19.6 million) of Coinone to her guardian firm with out securing collateral.

Associated: Suspected crypto exercise is rising in South Korea, with 36,000 instances in 2025

The operation was led by the Digital Asset Crime Joint Investigation Division underneath the primary prosecutor Lee Sang-Hyeok. Authorities acknowledged that the seizure was meant to safe information associated to the alleged breach of belief. The FSS had filed a proper grievance earlier this yr, on account of which public prosecutors open an investigation into the enterprise practices of the Change.

Coinone’s authorized combating: double recordings, citation scandals

The raid follows a separate authorized growth by which the platform is concerned. Coinone not too long ago received an enchantment in a case with regard to a system of the 2018 system with which some prospects might withdraw Bitcoin twice. The Western Court docket of Seoul dominated that 5 merchants ought to return the digital belongings and say that they’d acquired unjust enrichment.

Judges famous that community delays on Bitcoin’s blockchain contributed to the confusion, however the change shouldn’t bear the losses as quickly because the recordings had been accurately registered on the chain.

What’s at stake: Governance, Change Belief and Fees

The 2018 incident happened throughout a interval of heavy congestion on the Bitcoin community, when the reimbursements to a subsequent file $ 55 and greater than 250,000 transactions remained. The inner system of Coinone had marked some transfers as failed regardless of their completion, which resulted in duplicated recordings.

Whereas a decrease courtroom initially ordered partial harm, the choice of the enchantment laid the accountability on the merchants to return the funds. Coinon has additionally needed to take care of inside misconduct instances. In 2023, former staff admitted that they received as much as 2 billion (round $ 1.46 million) in funds to facilitate token lists.

The present probe to CEO Lee is concentrating on company governance and coping with change funds. Public Prosecutors haven’t but confirmed whether or not prices are being submitted, however the case stays lively as a result of researchers show proof that has been obtained within the RAID.

Associated: Ex-coinon change formally arrested for crypto-reforming scandal