The Public Prosecutor’s Office for Seoul’s Southern District has charged two executives of a South Korean cryptocurrency exchange called Coinnest for accepting a bribe in order to list a cryptocurrency company on the exchange. According to local media, they duo received the equivalent of 1 billion won ($890,000) worth of cryptocurrencies, mostly in Bitcoin core (BTC).
According to the reports, the financial investigation department of the Seoul Southern District Public Prosecutor’s Office indicted the CEO and COO of crypto exchange Coinnest “on charges of receiving a bribe,” as reported by Korea IT Times.
CEO Kim Ik-hwan and COO Cho are accused of accepting a bribe from the CEO of a firm seeking to list its cryptocurrency on Coinnest. Local media refer to this coin only as “S coin.” In addition to charging Coinnest’s executives, the report noted that “the prosecution also indicted another Kim, the CEO of S Coin, on charges of giving bribery, asking the two Coinnest executives to help with the virtual currency listing process.” It added “Coinnest CEO Kim and (COO) Cho received 1 billion won [$890,000] worth of bitcoin and S coin in early February this year in return for offering their convenience in listing the S coin.”
The report revealed that the duo “received a total of 110 bitcoins worth 860 million won [$771,270]” on February 5th and 6th adding that they also received “2 million S coins worth 70 million won [$62,778] each” on February 12th and 14th. The prosecution are said to be confident that the executives provided the issuer of S coin with the “unfair” convenience of listing the coin, such as listing “without precise examination of the technology of S coin and hastening the listing date of S coin.”
Back in April 23rd, two executives of Coinnest were also indicted on a different charge. Korean IT Times explained that they were charge with “violating the law on specific economic crimes, including fraud, along with the company executive Hong. At that time, Kim and his party were suspected of having embezzled money by selling fake coins as if they existed.”
In April, all major crypto exchanges in South Korea agreed to join forces to help in self-regulating the industry under the guidance of the Korean Blockchain Industry Association. However, Coinnest decided against joining the groip. In July, when the association announced that 12 out its 23 exchange members had done self-inspection, and Coinnest was not among them.
Coinnest, however, was one of the crypto exchanges that recently completed implementing short-term security measures, the Korea Internet and Security Agency (KISA) and the Korean Ministry of Science and Technology announced in August.