Ex-leader Lee Jung-Hoon of Bithumb, is suspected of $70 million fraud. He risks a 8 year prison sentence in South Korea. How did he proceed to steal such a sum of money?
A flight of 70 million dollars
The trial of the ex-Bithumb Holdings boss begins today, October 25. Nevertheless, we will know the verdict only in 2 months, on December 20th. Lee Jung-hoon is accused of having stolen the tidy sum of 70 million dollars to one person. The victim is Kim Byung Gun, CEO of the Korean cosmetic surgery empire: BK Group.
But how did Lee manage to steal such a sum from Kim? Apparently, the boss of BK Group would have paid the 70 million dollars to Lee Jung-hoon for “contract fees”. Provided that it introduces the BXA token so that it is listed on the stock exchange. Concretely, Kim lent money to Bithumb to be able to introduce your tokenlike an investment.
Wow, the Korean crypto scene is so rife with corruption.
— FatMan (@FatManTerra) October 25, 2022
However, it turns out that the ex-Bithumb leader did not never listed the BXA token. On the other hand, he would still have sold presales while the digital asset was not even listed. From now on, the prosecutors require against him a sentence of 8 years of prison. He is being prosecuted under the “Aggravated Punishment of Economic Crimes Law” for stealing a total of 112 million won from Kim Byung Gun.
Lee Jung-hoon said “I am very sorry for making the situation difficult for the employees and for causing social pressure“.
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Bithumb, who owns it now?
Officially, according to the social network Linkedin, Backyoung Heo seems to be the CEO of Bithumb. However, things seem to be much more complex and blurry than that.
Last month, the country was rocked when Kang Jong-hyun, the reclusive majority shareholder of Bithumb, was secretly romantically involved with A-list actress Park Min-young. Reporters also discovered that Kang’s affiliates had purchased Park’s talent agency. On top of that, they allegedly placed his older sister as the director of a publicly traded company he also owns.
Kang would be the “secret presidentfrom Bithumb, according to sources in the cryptocurrency industry. In addition, he owns three other companies which have all were searched by prosecutors who have been investigating these allegations since the beginning of the month. These include Vidente, a video equipment manufacturing company that would hold 34% of the capital of Bithump.
Investigations still ongoing
A team of journalists are currently investigating Bithumb and are expected to reveal new information soon. The show’s producers have already unveiled some of the results of their investigation. They claimed that Kang’s younger sister also appears to be a key player, as she is listed as the main shareholder of Vidente.
On top of that, she is also known as the largest shareholder of Inbiogen, another of the companies raided by prosecutors this month. This company is closely linked according to the press to Bithumb. Earlier revelations showed that Kang’s business card lists him as the CEO of InBioGen.
The TV show will also look at the fate of a botched $350 million takeover of Bithumb in 2018 by a Singapore-based plastic surgery practice. The BK Group consortium that we mentioned above accepted the operation in 2018, to find itself in payment default in 2019.
Politicians will also take an interest in this affair. A committee of the Korean National Assembly will bring together players in the national crypto sector to clarify the situation of Bithumb. In addition, they will be questioned about the Terra ecosystem crash case.
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