Dayoun “Diane” Lee
A diane@decentlaw.ioDiane brings deep expertise in case review and analysis, developed through her experience as a litigation finance analyst. She provides strategic legal counsel across civil, criminal, and emerging asset classes, delivering practical, results-driven representation tailored to each client's needs.
- Criminal
- Civil
- Crypto
- Corporate & Biz
- Cross-border · Dispute Resolution
- VC · Financial Advisory
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BlogsAccomplice Liability in Drug Cases Involving Privacy Coins: Dark Coins, Crypto Payments, and Investigation Risks in Korea
Why Are Privacy Coins Used in Online Drug Transactions? Monero (XMR), Zcash (ZEC), and similar assets are commonly referred to as privacy coins or “dark coins.” Unlike Bitcoin or Ethereum, where transaction records are generally visible on public blockchains, Monero is designed to make it difficult to identify the sender, recipient, and transaction amount through technologies such as ring signatures and stealth addresses. For this reason, Monero and other privacy-focused assets are sometimes used in online drug transactions, including transactions arranged through Telegram, dark web forums, and social media platforms. However, the fact that a transaction is difficult to trace does not mean that it is beyond the reach of law enforcement. Korean investigative authorities do not rely solely on on-chain transaction data. They may also review Telegram messages, mobile device forensic data, statements from sellers and buyers, exchange records, fiat conversion history, and other evidence to identify those involved in the transaction. In other words, privacy coins may make an investigation more complex, but they do not make an investigation impossible. Key Korean Laws That May Apply In drug-related cases involving privacy coins, multiple laws may apply depending on the person’s role and level of involvement. Legal Basis Main Conduct Covered Possible Penalty Narcotics Control Act, Article 60(1)2 Sale, brokerage, receipt, possession, or use of certain psychotropic substances, including substances classified under Schedules B or C Imprisonment for up to 10 years or a fine of up to KRW 100 million Narcotics Control Act, Article 58(1)3 Manufacturing, import/export, sale, brokerage, receipt, or possession for such purposes of Schedule A psychotropic substances Life imprisonment or imprisonment for at least 5 years Act on Reporting and Using Specified Financial Transaction Information Operating a virtual asset business without the required VASP registration Imprisonment for up to 5 years or a fine of up to KRW 50 million Act on Regulation and Punishment of Criminal Proceeds Concealment Concealing or disguising proceeds from drug-related crimes Imprisonment for up to 5 years or a fine of up to KRW 30 million Even if a person did not directly sell or possess drugs, liability may still arise if they connected buyers and sellers, facilitated payment flows, exchanged virtual assets, or helped conceal criminal proceeds. In addition, if a person operates an over-the-counter (OTC) virtual asset service without proper registration and the service is used to process drug-related funds, separate issues may arise under Korea’s anti-money laundering and virtual asset regulations. The applicable law and potential penalty will depend on the type of substance involved, the exact conduct, whether the conduct was repeated, whether any compensation was received, and whether the person knew or should have known the criminal nature of the transaction. Crypto-Related Drug Investigations Are Expanding in Korea Drug transactions in Korea are increasingly moving from offline channels to online platforms such as Telegram, dark web marketplaces, and social media. According to media reports citing Korean police data, from January to April 2026, 9.2% of all drug offenders were reported to have used virtual assets. This was higher than the annual figure of 8.4% recorded in the previous year. The proportion of online drug offenders has also continued to rise. Media reports indicate that the figure increased from 24.0% in 2021 to 42.0% during the January–April 2026 period. Korean authorities are also strengthening their investigative infrastructure. In 2026, the Ministry of Science and ICT and the Korean National Police Agency began promoting a project to develop an integrated investigation system linking dark web activity, virtual asset transaction tracing, and online drug advertisement monitoring. The police have also established dedicated virtual asset investigation teams in major regional police agencies, including Seoul, Busan, Incheon, Gyeonggi Nambu, and Gyeongnam. As a result, crypto-related drug investigations in Korea are no longer limited to the question of whether a coin transaction can be traced on-chain. Investigators may analyze online communications, wallet and exchange records, fiat conversion records, device forensics, transaction patterns, and statements from co-suspects together. Using a Privacy Coin Does Not Prevent Accomplice Liability In a Korean drug investigation, the key issue is not simply the payment method. The more important question is how the person was involved in the drug transaction. The Narcotics Control Act does not only punish direct sales. It may also punish inducement, solicitation, brokerage, receipt, possession, use, importation, and manufacturing, depending on the substance and conduct involved. For example, methamphetamine is generally treated as a Schedule B psychotropic substance under Korean law. If a person sells, brokers, receives, possesses, or uses methamphetamine, Article 60(1)2 of the Narcotics Control Act may apply, which provides for imprisonment of up to 10 years or a fine of up to KRW 100 million. If the case involves importation or manufacturing of methamphetamine, a more serious provision may apply. Under Article 58(1)6 of the Narcotics Control Act, manufacturing or importing/exporting certain Schedule B psychotropic substances may be punishable by life imprisonment or imprisonment for at least 5 years. This means that the applicable charge can vary significantly depending on whether the conduct involved simple use, possession, sale, brokerage, aiding and abetting, importation, or manufacturing. Therefore, if you are contacted by Korean law enforcement, the first question should not be “Which coin was used?” but rather “What specific charge is being investigated?” Why “I Only Introduced the Parties” May Not Be Enough In many cases, suspects say: “I did not sell the drugs myself.” “I never touched the drugs.” “I only shared a Telegram link.” “I only helped connect two people.” However, Korean drug laws do not only target the final seller. If a person connects a buyer and a seller, directs someone to a sales channel, shares sales posts, helps arrange payment, or receives a commission after the transaction, the conduct may be viewed as brokerage or aiding and abetting. The following circumstances may increase legal risk: Repeatedly sharing Telegram channel links Connecting potential buyers to sellers Receiving a commission after a transaction Receiving the commission in Monero or another virtual asset Maintaining repeated contact with buyers or sellers Being named in a statement by an arrested seller or buyer In particular, receiving compensation in a privacy coin may be interpreted as an attempt to avoid detection. As a result, saying “I only introduced the parties” may sometimes help explain limited involvement, but it can also be used as evidence that the person knowingly participated in the transaction structure. What Evidence Do Korean Investigators Review? In privacy coin drug cases, Korean investigators generally do not rely on blockchain data alone. They may review the following types of evidence. First, they may review Telegram, KakaoTalk, Discord, or other messaging records. Even if the server is located overseas, messages, deleted data, files, images, contact information, and login records may be recovered through forensic analysis if a mobile phone or computer is seized. Second, they may rely on statements from co-suspects. If a seller or buyer is arrested first, the person may identify intermediaries, brokers, or payment facilitators during questioning. In that situation, even someone who was not present at the actual transaction may become a suspect. Third, they may review virtual asset and exchange records. Even if the privacy coin itself is difficult to trace, exchange registration records, deposit and withdrawal history, fiat conversion records, and transactions involving other virtual assets may still be reviewed. Fourth, they may assess repetition and compensation. A one-time message may be viewed differently from repeated introductions, repeated sharing of sales channels, or commission-based involvement. Whether the person received payment can significantly affect how the conduct is characterized. Before attending an interview, it is important to distinguish between what the investigators may already have and what the person’s actual role was. What to Check Before Attending a Police Interview If you are contacted by Korean law enforcement, it may be risky to immediately state, “I did not know,” or “I did not sell anything.” Early statements are later compared with police interview records, seized digital evidence, forensic results, and statements from co-suspects. If your statement changes or conflicts with other evidence, even limited involvement may be interpreted more unfavorably. Before attending an interview, you should check: The specific charge listed in the summons or notice Whether you are being treated as a suspect or a witness Whether your phone, computer, or other device has been seized The scope of Telegram, KakaoTalk, Discord, or other message records Whether any virtual asset wallet or exchange account was used Whether any seller or buyer has already been arrested Whether any commission or payment was received Whether there is evidence of repeated introductions or referrals Depending on these facts, the case may remain a witness interview, or it may develop into a full criminal investigation involving brokerage, aiding and abetting, or other drug-related charges. Once an interview date is scheduled, it is important to prepare a clear and consistent statement strategy in advance. Early Legal Response Matters in Privacy Coin Drug Investigations Using Monero or another privacy coin does not mean that a person is safe from investigation. Korean authorities are increasingly analyzing online drug transactions through Telegram records, virtual asset transaction structures, exchange and fiat conversion records, forensic evidence, and statements from co-suspects. In drug cases, the applicable law and penalty can vary significantly depending on whether the allegation involves use, possession, sale, brokerage, aiding and abetting, importation, or manufacturing. How you explain your role in the transaction, whether you received compensation, and how you respond to digital evidence and co-suspect statements may affect the direction of the case. Decent Law Firm’s criminal defense team assists clients in drug investigations involving virtual assets, digital forensic issues, and alleged accomplice liability. If you have received a police summons in Korea in connection with Monero, privacy coins, Telegram drug transactions, or virtual asset payments, it is important to review your situation before attending the interview. This content is provided for general informational purposes only and does not constitute legal advice for any specific case.
2026-06-15 -
Blogs
Criminal Risks for MetaTrader-Based Overseas Futures Signal and Copy Trading Operators in Korea
Growing Scrutiny of MetaTrader-Based Overseas Futures Signal Businesses MetaTrader 4 and 5 are trading platforms commonly used for overseas futures, FX trading, and CFDs, or contracts for difference. The MetaTrader platform itself is not illegal. The legal risk arises from how the business is operated. In Korea, issues may arise where an operator uses MetaTrader to run a trading signal room, copy trading service, or investment consulting business, while also directing users to a specific overseas broker and receiving referral commissions based on users’ trading volume. In such cases, Korean investigative authorities may examine whether the business structure constitutes fraud under the Korean Criminal Act or a violation of the Financial Investment Services and Capital Markets Act, commonly referred to as the Capital Markets Act. Applicable Laws Allegation Applicable Law Statutory Penalty Inducing investment through deception Article 347 of the Criminal Act, Fraud Imprisonment for up to 20 years or a fine of up to KRW 50 million, based on the current provision as of the publication date Conducting unregistered investment advisory or discretionary investment management business Articles 17 and 445(1) of the Capital Markets Act Imprisonment for up to 3 years or a fine of up to KRW 100 million Conducting unauthorized investment brokerage business Articles 11 and 444(1) of the Capital Markets Act Imprisonment for up to 5 years or a fine of up to KRW 200 million Paid one-on-one or interactive signal services beyond the scope of quasi-investment advisory business Articles 17 and 445(1) of the Capital Markets Act Imprisonment for up to 3 years or a fine of up to KRW 100 million Improper business conduct by a quasi-investment advisory business operator Article 101-2 of the Capital Markets Act and related provisions Administrative sanctions, including administrative fines, inspections, and possible cancellation of registration The statutory penalty for fraud under the current Korean Criminal Act is imprisonment for up to 20 years or a fine of up to KRW 50 million. However, the actual penalty range in a specific case may vary depending on the timing of the alleged conduct, the applicable version of the law, and whether multiple offenses are found to be in concurrence. Fraud and violations of the Capital Markets Act are separate offenses with different legal elements and protected interests. Where both allegations are raised, the overall criminal exposure may increase depending on the scale of damage, business period, amount of referral revenue, and the specific role of the operator. Fraud Issues Under the Korean Criminal Act For fraud to be established in an investment-related case, there must generally be deception, mistake, a disposition of property, financial gain, and a causal relationship between these elements. In MetaTrader-based signal or copy trading cases, investigative authorities may focus on whether the operator had the actual ability and intent to generate the profits represented to customers. 1. Ability to Generate Profits Investigators may review the operator’s investment experience, trading record, risk management ability, and the explanations given to customers to determine whether the operator had an objective basis for the profits described. If the operator claimed to be an expert despite limited investment experience, or used expressions such as “stable returns,” “principal guaranteed,” or “no-loss trading,” those statements may become important factors in assessing whether the customer was misled. Overseas futures, FX, and CFDs are high-risk derivative products with significant volatility and potential for loss. Therefore, statements implying fixed or stable profits may be viewed unfavorably if they are inconsistent with the actual trading structure and risk profile. 2. Intent to Act in the Customer’s Interest Another key issue is whether the operator genuinely intended to pursue the customer’s investment interest. If the operator’s referral commission increased according to the customer’s trading frequency or trading volume, regardless of whether the customer made a profit or loss, investigators may question whether the operator prioritized referral income over the customer’s investment outcome. For example, if a customer states that they would not have invested had they known that substantial trading fees and referral commissions would be generated, the failure to disclose that fee structure may be considered a form of deception by omission. Issues Under the Capital Markets Act 1. Scope of Quasi-Investment Advisory Business Under Article 101 of the Capital Markets Act, a quasi-investment advisory business generally refers to a business that provides non-individualized investment advice on financial investment products to an unspecified number of clients for consideration, through publications, communications, broadcasts, or similar means. Paid investment advice provided through interactive channels such as KakaoTalk, Telegram, or open chat rooms may go beyond the permissible scope of quasi-investment advisory business and may be regulated as investment advisory business. A quasi-investment advisory business registration alone does not generally allow the operator to provide specific one-on-one instructions to individual users, such as entry points, liquidation timing, stop-loss levels, or take-profit levels. Such conduct may raise issues of unregistered investment advisory business under Articles 17 and 445(1) of the Capital Markets Act. 2. Possible Unregistered Discretionary Investment Management Business In a copy trading structure, if the operator uses a customer’s account, API access, or trading authority to substantially control the management of the customer’s assets, the business may be examined as a possible unregistered discretionary investment management business. Discretionary investment management generally involves managing a client’s assets by making investment decisions on behalf of the client. If the operator goes beyond simply providing market information and effectively controls trading decisions and execution, the conduct may fall within the scope of regulated financial investment business. 3. Possible Unauthorized Investment Brokerage Business If the operator actively directs users to a specific overseas broker, assists with account opening, deposits, or trade execution, and receives commissions in connection with that activity, the structure may raise issues of unauthorized investment brokerage business under Articles 11 and 444(1) of the Capital Markets Act. Simply posting a link or introducing a broker does not automatically amount to investment brokerage. However, if the operator provides account-opening guidance, deposit instructions, trading education, product-specific recommendations, and receives referral commissions, Korean authorities may review the overall business structure to determine whether the operator was effectively engaging in regulated financial investment business. Practical Response During an Investigation In these cases, investigative authorities tend to focus on the operator’s ability, intent, disclosure practices, and the actual structure of referral compensation. Because statements made during the early stages of an investigation may later become important evidence in court, it is important to review the legal structure of the business as soon as the operator is contacted by the police or another investigative authority. Key issues to review include: Whether customers were properly informed of the risks of margin trading, leverage, forced liquidation, and fee structures Whether expressions such as “guaranteed profit,” “stable return,” or “principal guaranteed” were used Whether the current business model falls within the permissible scope of a quasi-investment advisory business How the referral commission structure is connected to customers’ trading volume, trading frequency, or investment performance DECENT Law Office’s Digital Asset and Financial Investment Team advises on criminal and regulatory matters involving MetaTrader-based overseas futures signal services, copy trading structures, referral commission models, and related Capital Markets Act issues. If you have received a criminal complaint, a police summons, or notice of a preliminary investigation, or if you wish to review whether your current business structure is legally appropriate under Korean law, it is important to first examine the specific facts and operational details of the business.
2026-06-10 -
Blogs
Unlisted Stock Investment Fraud in Korea: Can You Recover Your Money?
Current Trends in Unlisted Stock Investment Fraud Unlisted shares are shares that are not traded on a public stock exchange. In Korea, these shares are often sold through private transactions, intermediaries, or over-the-counter channels. Because pricing information is not publicly available and the transaction process is often opaque, unlisted stock investments can easily become a source of fraud. A common pattern involves inducing investors to pay large sums based on claims such as “the company will soon be listed” or “a KOSDAQ listing is imminent.” Victims often wait for years, believing that the listing has simply been delayed, and may not realize that they have been defrauded until much later. Recently, fraud schemes have become more sophisticated. Rather than selling shares that do not exist, some perpetrators sell shares that actually exist but are of little value, inducing victims to purchase them at prices dozens of times higher than their real market value. Because the shares themselves may exist, victims often find it difficult to recognize the fraud at an early stage. This article explains the laws and court precedents that may apply to unlisted stock investment fraud in Korea, as well as the legal options available for recovering investment losses. Applicable Laws Several Korean laws may apply to unlisted stock investment fraud cases, depending on the facts, the amount of damage, and the role of each participant. Category Main Issue Statutory Penalty Fraud Obtaining money or property by inducing investment through false information Article 347 of the Korean Criminal Act: imprisonment for up to 10 years or a fine of up to KRW 20 million Aggravated Fraud Fraud involving damages of KRW 500 million or more Article 3 of the Act on the Aggravated Punishment of Specific Economic Crimes: imprisonment for at least 3 years Illegal Fund-Raising Receiving investment funds without authorization while promising principal or profit guarantees Articles 3 and 6(1) of the Act on the Regulation of Conducting Fund-Raising Business Without Permission: imprisonment for up to 5 years or a fine of up to KRW 50 million Violation of the Capital Markets Act Conducting unregistered investment advisory or discretionary investment management business Article 444 of the Financial Investment Services and Capital Markets Act: imprisonment for up to 5 years or a fine of up to KRW 200 million Depending on the scale of the damage and the manner of involvement, multiple charges may apply at the same time. Key Factors in Determining Fraud For fraud to be established in an unlisted stock investment case, the investigative authorities must examine whether there was deception and fraudulent intent at the time of the transaction. The Supreme Court of Korea has held that: “Unless the defendant confesses, fraudulent intent, which is a subjective element of fraud, must be determined by comprehensively considering objective circumstances such as the defendant’s financial condition before and after the act, the surrounding circumstances, the nature of the transaction, and the process of performance.” — Supreme Court Decision 2015Do10570, December 27, 2019 In other words, even if the perpetrator claims that they genuinely believed the company would be listed, investigative authorities and courts may still find fraudulent intent based on objective facts, such as the company’s financial condition, false explanations, and how the investment funds were used. In practice, investigators often focus on the following circumstances: False listing schedule: whether the perpetrator stated a specific listing timeline despite the lack of any realistic basis. Misuse of investment funds: whether the money was used for purposes different from what was promised to investors. Impossibility of performance: whether it was impossible from the beginning to transfer the shares or perform the promised obligations. Active involvement of intermediaries: whether an introducer or broker received commissions or directly participated in persuading the investor. Fraud organizations may also attempt to avoid liability under the illegal fund-raising regulations by avoiding direct phrases such as “principal guarantee.” Instead, they may use indirect expressions such as “repurchase commitment if listing fails” or “compensation for the difference if the public offering price is lower than expected.” Under Korean court practice, these types of clauses may still be interpreted as an agreement to preserve principal or profits under Article 2 of the Act on the Regulation of Conducting Fund-Raising Business Without Permission. Legal Strategy for Recovering Investment Losses Filing a criminal complaint does not automatically result in the recovery of the invested funds. In many cases, both criminal and civil procedures must be considered together. A criminal complaint can be useful because it allows investigative authorities to trace the flow of funds and secure evidence through compulsory investigation. If search and seizure is conducted at an early stage, it may help identify relevant accounts and determine where the investment funds went. Civil asset preservation measures, such as provisional attachment, are also important. These procedures are designed to freeze the perpetrator’s assets before they are disposed of or transferred. In many cases, filing for provisional attachment at the same time as, or shortly after, the criminal complaint can improve the possibility of recovery. The likelihood of recovery usually depends on the following factors: Assets held by the perpetrator: real estate, bank deposits, or other identifiable assets may be subject to provisional attachment. Traceability of funds: clear bank transfer records and account flows can make recovery more realistic. Scope of accomplices: if introducers, recruiters, or account holders were involved, it may be possible to pursue claims against those whose assets can be identified. Timing of response: the earlier the response, the more legal options may remain before the perpetrator disappears or disposes of assets. In unlisted stock investment fraud cases, the question is not only whether a criminal complaint can be filed. It is equally important to determine who should be targeted, what assets may be preserved, and which legal procedures should be pursued first. Review by DECENT Law Firm’s Criminal Defense and Fraud Response Team Unlisted stock investment fraud cases require a comprehensive legal review. The key issues include whether fraud can be established, whether accomplices can be identified, whether assets can be preserved, and how criminal and civil procedures should be coordinated. DECENT Law Firm’s criminal defense and fraud response team has handled unlisted stock investment fraud cases from the criminal complaint stage through asset preservation and recovery strategy. If your investment has not been returned, or if the person in charge has stopped responding, it is important to review your situation before more time passes. This content is provided for general informational purposes only and does not constitute legal advice for any specific case.
2026-06-02
