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Blogs CryptoDo Crypto & Stock Influencers (KOLs) Have to Disclose Their Holdings? What the New Korean Law Means for You
Crypto and stock influencers in Korea are increasingly hearing the term "mandatory asset disclosure" — and for good reason. The Democratic Party of Korea is preparing legislation that would require financial influencers (KOLs) who recommend stocks or crypto assets to publicly disclose the type and quantity of assets they hold, as well as any compensation they receive. What Does the Proposed Amendment Actually Require? The proposed amendment to the Virtual Asset User Protection Act centers on three key obligations. Anyone who repeatedly recommends crypto, stocks, or other financial investment products to a broad audience — or who receives compensation to encourage trading — must disclose the type and quantity of assets they hold, along with any remuneration received. Remuneration includes not just cash, but tokens, commissions, advertising fees, and other forms of payment. The penalties are what make this significant. This is not a minor administrative fine. Violations could be treated on par with market manipulation and front-running under the Capital Markets Act — in other words, a serious market order violation. Why Does This Matter Now, Before the Law Has Even Passed? Even before the legislation is enacted, the market has already shifted. Influencers who do not disclose their holdings are increasingly viewed with suspicion. In the digital asset space in particular, a common practice has come under scrutiny: receiving token allocations at below-market prices with short lock-up periods, then publishing investment recommendation content to followers. This structure is one of the primary targets of the proposed legislation. Once the law passes, past content could also become an issue. That is why now is the time to review how your channel operates. What KOLs and Trading Room Operators Need to Check Right Now The core question is: what do I need to disclose, and how much? 1. Disclosure of Holdings in Recommended Assets If you recommend a coin or stock, you need a clear standard for disclosing whether you hold it, the size of your position, and when you acquired it. Simply mentioning that you also hold the asset is not enough — the specific wording and timing of your disclosure matters. 2. Compensation Received from Projects or Exchanges If you receive cash, tokens, commissions, or advertising fees from any project or exchange, you need to document what form the payment takes, when it is received, and where and how it is disclosed in your content. Receiving compensation is not itself a problem. Concealing it is. 3. Paid Trading Rooms and Membership Services Even if you describe your service as "sharing information," you need to assess whether it could be characterized as investment advisory activity in substance. This includes checking whether you meet the registration requirements for a quasi-investment advisory business, and whether your terms of service and operating structure are aligned with the direction of the new regulations. If Any of the Following Apply to You, Consult a Lawyer Before Continuing You have received tokens or commissions from a project and recommended that asset to your audience. You operate a paid trading room or membership service where you share trade timing information. You have used language such as "principal guaranteed" or "guaranteed returns" in your content. You have received token allocations with short lock-up periods or favorable pricing, and subsequently published investment recommendation content. If any of these apply, the way you currently operate your channel may be a direct target of the proposed legislation. If You Run a Channel, Set Your Standards Now The question we hear most often from KOLs and influencers is this: "How much do I actually need to disclose? If I share too much, I expose my strategy. If I share too little, it looks like I'm hiding something." The answer is not to disclose everything. It is to establish a clear, consistent disclosure standard that fits your business model — before a problem arises. In actual virtual asset and capital markets cases, individuals who had defined their disclosure and documentation standards in advance and applied them consistently had significantly more room to defend themselves when investigations or complaints arose. Decent Law Firm's Virtual Asset Practice Group can help you identify where your current channel and content structure may carry legal exposure, establish an asset disclosure standard aligned with amendments to the Capital Markets Act and the Virtual Asset User Protection Act, draft disclosure language and disclaimers for conflict-of-interest situations, and review your terms of service and operating structure if you run a paid service. If you are already running a channel, or planning to launch KOL activity in earnest, get your standards in place now — before a complaint, investigation, or lawsuit forces the conversation. Contact Decent Law Firm's Virtual Asset Practice Group today.
2026-03-11 Naver Blog -
Blogs Crypto
Inheriting Crypto on Korean Exchanges: What You Need to Know
As crypto ownership continues to grow in Korea, so do cases where someone passes away still holding digital assets. The first question families almost always ask is the same: "Can we actually claim the crypto our loved one left behind on the exchange?" The short answer is yes. The Korean National Tax Service treats virtual assets as part of a deceased person's taxable estate, and since 2022, the Inheritance and Gift Tax Act has included explicit provisions for valuing crypto assets. Coins held on domestic exchanges like Upbit and Bithumb are legally inheritable — heirs can claim them through the proper succession process. That said, knowing you're entitled to something and actually getting it are two very different things. What Counts as Inheritable Crypto It's not just coins sitting in an exchange wallet. The deceased may have held digital assets in more forms than you'd expect: Coins held in accounts on Korean exchanges such as Upbit or Bithumb Major cryptocurrencies including Bitcoin (BTC) and Ethereum (ETH) Assets currently staked or locked in yield products Open or pending orders on exchange accounts Holdings spread across multiple exchanges The first step is figuring out where the deceased held their assets and in what form — and that alone can be a challenge. Why Korean Exchange Inheritance Is More Complicated Than It Sounds Korean exchange accounts are registered under the account holder's identity and built around personal authentication. By design, no one else can log in or withdraw funds — not even a family member. Upbit and Bithumb operate under different companies and handle inheritance requests differently. What works at one exchange may not fly at the other. Things get significantly harder when any of the following apply: You didn't know the account existed or what was in it There are multiple heirs or the inheritance structure is disputed You can't access the phone number or authentication method tied to the account The deceased held assets across several different exchanges Why This Is Hard to Handle on Your Own Even when heirs contact exchanges directly, they often run into vague guidance, shifting requirements, and delays that stretch on for weeks or months. If co-heirs aren't cooperating, or you can't even confirm whether an account exists, it can feel impossible to move forward. And while time slips away, legal deadlines don't wait. Claiming inherited crypto isn't a customer service issue — it's a legal matter. You need to formally establish your standing as an heir before any exchange will release the assets. The virtual asset team at Decent Law Firm has handled inheritance cases across Upbit, Bithumb, Coinone, and other Korean exchanges firsthand. If you're trying to recover crypto a family member left behind, reach out — we'll walk you through it from start to finish.
2026-03-06 Naver Blog -
Blogs Crypto
Must-Read Guide for Victims of Crypto Hacking Scams
How Channel-Hacking Crypto Scams Typically Operate Recent crypto hacking scams often unfold in the following sequence: Hijacking of a YouTube account Broadcasting a fake investment livestream Directing viewers to an external website or QR code Inducing wallet connection (Approve) or transfer of USDT/Bitcoin Draining tokens using granted approval authority and then disappearing In particular, “wallet-connection” scams differ from simple transfers. The moment a user approves a smart contract, the attacker may repeatedly move assets using that authorization. Such conduct may constitute computer fraud under Article 347-2 of the Criminal Act, as it involves unlawfully inputting information into an information processing system to obtain financial benefits. Immediate Actions If You Are a Victim Early response determines the direction of the case. If you realize you have been victimized by a crypto hacking scam, you should immediately: Revoke all token allowances (approval permissions) Create a new wallet and transfer any remaining assets Change all exchange passwords and OTP settings Secure evidence such as transaction hashes, counterparty wallet addresses, and access screen captures If funds were transferred to a centralized exchange, immediately request account freezing Virtual assets are often dispersed across multiple addresses within a short period. The first 24–48 hours are critical. As time passes, tracing becomes significantly more difficult, and recovery chances decrease sharply. Key Legal Issues in Pursuing Action Investment scams involving channel hacking are not merely civil disputes. They may involve multiple criminal charges, including: Fraud (Article 347 of the Criminal Act) Unauthorized access or intrusion under the Act on Promotion of Information and Communications Network Utilization and Information Protection (Articles 48 and 71) Computer fraud (Article 347-2 of the Criminal Act) Violations of the Electronic Financial Transactions Act (Articles 21-4 and 49) However, simply stating “I was deceived and transferred funds” is often insufficient to prompt proactive investigative measures. To establish fraud under Article 347 of the Criminal Act, the following elements must be proven: Deceptive conduct Inducement of mistake Disposition of property Occurrence of financial loss Causal relationship between deception and loss In particular, the specific content of the deception and the causal link showing that the victim transferred assets due to that deception must be clearly demonstrated. Ultimately, resolving crypto hacking scams requires a structured, data-driven approach—not emotional reaction. Understanding the technical flow and evidentiary framework is essential to identifying a viable path toward recovery.
2026-02-23 Naver Blog -
Blogs Crypto
If you are suffering as a victim of cryptocurrency fraud involving wallets or related regulatory legislation, this is essential reading.
Cryptocurrency Fraud – Why Is It Increasing So Rapidly? The primary reasons for the recent surge in cryptocurrency fraud are information asymmetry and the complexity of its structure. Project structures, token issuance mechanisms, and profit models are often designed in ways that are difficult for ordinary investors to fully understand. This environment creates fertile ground for fraudulent schemes to appear as legitimate investment opportunities. Common types of cryptocurrency fraud include: Inducing investment by promising high returns Multi-level or referral-based structures resembling pyramid schemes Providing false listing information Guaranteeing profits through automated trading programs Such conduct may constitute fraud under Article 347(1) of the Criminal Act or violations of the Act on the Regulation of Conducting Fund-Raising Business Without Permission. Because technical explanations and whitepapers often exist on the surface, it is not easy to detect suspicion in the early stages. In particular, schemes that build trust by paying initial returns to early investors make it extremely difficult for victims themselves to recognize warning signs. As a result, cryptocurrency fraud often continues for a significant period before it is finally exposed. Cryptocurrency Fraud Damage – What Legal Issues Arise? The most critical legal issue in cryptocurrency fraud cases is distinguishing between a mere investment failure and a criminal act of fraud. Whether fraud is established must be assessed based on the circumstances at the time the investment was solicited. If, at the time of solicitation, the promoter had both the intent and ability to repay, a subsequent refusal to repay may constitute only a civil breach of contract rather than criminal fraud. However, if criminal liability is established, the following laws may apply: Fraud (Article 347(1) of the Criminal Act) Violation of the Act on the Regulation of Conducting Fund-Raising Business Without Permission (Articles 3 and 6(1)) Aggravated Fraud under the Act on the Aggravated Punishment of Specific Economic Crimes (Article 3(1)) From a civil perspective, key issues include: Claims for damages based on tort Claims for return of unjust enrichment In this process, identifying the perpetrator and tracing the flow of funds are decisive factors in determining the outcome of the case. In cryptocurrency fraud cases, securing digital evidence is essential. This includes: Cryptocurrency wallet addresses Exchange transaction records Platform logs Chat records Investment solicitation materials Since the subjective element of fraud (intent to defraud) must be inferred from objective circumstances—such as the defendant’s financial status, surrounding conditions, the content of the transaction, and the performance process—unless the defendant confesses, failure to secure such evidence at an early stage may make later proof extremely difficult. Essential Response Steps If You Have Been Defrauded If you realize that you have fallen victim to cryptocurrency fraud, the first step is to immediately stop any additional transfers and cease attempts to negotiate under the perpetrator’s persuasion. This does not mean that settlement for recovery is prohibited. However, even during settlement discussions, it is critical to secure evidence and obtain assistance from a legal professional. Another essential step is organizing evidence. You should systematically compile: Chat records Deposit and withdrawal records Promotional materials Contract-like documents Afterward, you must carefully determine the timing and method of filing a criminal complaint or reporting to investigative authorities. If a complaint is filed prematurely without sufficient evidence, it may negatively affect the investigation. Therefore, it is generally more effective to organize evidence thoroughly with professional legal assistance before initiating criminal proceedings. When victims attempt to handle the matter alone, the core nature of the case is often reduced to a simple dispute, or time is wasted without properly identifying the perpetrator. In cryptocurrency fraud cases, initial strategic direction and speed are crucial. This point cannot be emphasized enough.
2026-02-10 Naver Blog -
Blogs Crypto
How Should the Bithumb Bitcoin Erroneous Transfer Incident Be Viewed Legally?
Overview of the Incident A single input error resulted in an erroneous transfer worth approximately KRW 60 trillion. On February 6, 2026, an unprecedented incident occurred at Bithumb. Instead of distributing a promotional reward of KRW 2,000, a staff member mistakenly entered the unit incorrectly and transferred 2,000 Bitcoin. As a result, approximately KRW 196 billion per recipient was credited, and some of the Bitcoin was immediately sold on the market, causing a temporary sharp decline in prices. Although the incident originated from a system error, its impact extended far beyond an internal operational mistake and affected the broader market. Key Legal Issues The core legal issue in the Bithumb Bitcoin erroneous transfer incident lies in distinguishing criminal liability from civil liability. Many initially consider whether embezzlement charges could apply. However, according to the Supreme Court decision dated December 16, 2021 (2020Do9789), virtual assets are not considered “property” under the Criminal Act but rather “property-based interests.” The Court held that even if a person who receives mistakenly transferred virtual assets uses or disposes of them at their own discretion, it is difficult to conclude that such a person occupies a position of managing another’s affairs based on a fiduciary relationship. Accordingly, the offense of breach of trust does not apply. Therefore, merely receiving and using or disposing of virtual assets transferred by mistake does not easily lead to criminal punishment such as embezzlement or breach of trust under the current criminal law framework. However, the legal analysis does not end there. Assets acquired through the erroneous Bitcoin transfer constitute gains obtained without legal cause, and thus may be evaluated as unjust enrichment under the Civil Act. In such cases, the recipient bears an obligation to return the unjust enrichment regardless of intent or negligence. Even if part of the assets has already been disposed of, a recipient acting in bad faith must return the received benefits with interest and compensate for any resulting damages (Article 748(2) of the Civil Act). Since the obligation to return unjust enrichment does not have a fixed due date, the recipient becomes liable for delay damages from the time a demand for return is made (Article 387(2) of the Civil Act). Attorney’s Opinion “Although this incident originated from a system error, it will ultimately be resolved through restoration. Bithumb has sufficient recovery capabilities, and full recovery is legally possible. If any recipients are currently in discussions with Bithumb after receiving the erroneously transferred assets, returning them would be the prudent course of action to avoid unnecessary legal disputes. At this point, a rational resolution is necessary to preserve the integrity of the market.” Conclusion The outcome of this incident ultimately depends on the legal perspective applied. Decent Law Firm provides comprehensive legal analysis for recipients and related parties involved in large-scale virtual asset incidents such as the Bithumb Bitcoin erroneous transfer, including civil return procedures, negotiation processes, and dispute response strategies. By analyzing legal risks associated with different return methods, structuring negotiations with counterparties, and proposing response strategies to minimize additional damages, we aim to prevent disputes from escalating into prolonged litigation and to facilitate rational resolutions between the parties. The Bithumb Bitcoin erroneous transfer incident demonstrates how a technical mistake can quickly evolve into a serious legal issue. Only calm legal judgment and swift, well-informed responses can restore trust in the market. If you are a party with interests at stake in connection with the Bithumb Bitcoin erroneous transfer, a rational decision based on legal standards—rather than emotional judgment—is essential.
2026-02-09 Naver Blog -
Blogs Crypto
Is Crypto Referral Legal? Why Financial Authority Press Releases Are Not Enough
Following a recent press release by the Financial Services Commission (FSC), inquiries regarding the legality of crypto referral programs have increased significantly. Many businesses that use exchange referral codes for marketing, investment advisory services, or community operations are now concerned about potential violations of the Act on Reporting and Using Specified Financial Transaction Information (the “AML Act”). However, the legality of crypto referral programs cannot be determined solely based on an FSC press release. In practice, legal assessments must take into account the statutory provisions of the AML Act, relevant court decisions, and investigative standards applied by law enforcement authorities. The Meaning and Limitations of the FSC Press Release In its press release, the FSC suggested that certain referral structures could constitute brokerage or intermediary activities involving virtual asset exchanges. It is important to note, however, that this position reflects an administrative interpretation, not a binding judicial ruling or settled legal doctrine. When legal liability is at issue, courts ultimately determine—on a case-by-case basis—whether a specific referral structure satisfies the statutory elements of a regulated virtual asset service provider under the AML Act. Accordingly, it is legally inappropriate to conclude that all referral programs are unlawful based solely on regulatory commentary. The Core Legal Issue Under the AML Act Article 7 of the AML Act imposes reporting obligations on virtual asset service providers. The key question is whether a referral program goes beyond simple advertising or promotion and instead constitutes the business of brokering or intermediating the purchase, sale, or exchange of virtual assets. In making this determination, authorities focus not on the mere use of referral codes, but on substantive factors such as whether the operator intervenes in transaction structures, influences investment decisions, controls the flow of funds, or effectively forces users to use a specific exchange. Absent these elements, referral activities are generally viewed as marketing rather than brokerage. Guidance from Court Decisions and Investigative Practice Court rulings and multiple non-indictment decisions indicate a consistent approach: referral programs are often characterized as marketing arrangements provided by exchanges, carried out based on users’ voluntary choices. Where the operator does not execute trades, handle customer funds, or mandate the use of a specific exchange, it is difficult to classify such activities as regulated virtual asset services. In practice, investigative authorities tend to focus less on the existence of a referral program itself and more on whether it is combined with fraudulent conduct, unregistered business operations, or substantive involvement in investment decisions. Key Considerations for Crypto Referral Businesses That said, not all referral structures are risk-free. Legal concerns may arise where a business repeatedly promotes only a single exchange, excludes alternative options, or combines referral activities with investment guidance that materially affects users’ decisions. In such cases, the activity may be viewed as de facto brokerage or intermediation. Ultimately, the legality of a crypto referral program depends not on its label, but on whether the overall business structure can be legally justified under the AML Act. Businesses that currently operate referral programs—or are considering implementing them—should carefully assess their structure before regulatory or investigative issues arise. Decent Law Firm’s Digital Asset Team provides legal opinions on the compliance of crypto referral structures, evaluates AML Act risks, and assists clients in preparing for potential regulatory or investigative scrutiny. Crypto referrals are not simply a question of “legal or illegal,” but whether the structure can be clearly explained and defended under the law. If you require a legal review of your crypto referral business model, consulting experienced legal professionals at an early stage can be a critical step in risk management.
2026-02-04 Naver Blog -
Blogs Crypto
The Legal Boundaries of Virtual Assets Through the Lens of the Bitcoin Whitepaper
The Bitcoin Whitepaper Is Not a “Manual,” but a Legal Benchmark Many people understand the Bitcoin whitepaper as nothing more than a technical document. In actual disputes or criminal investigations, however, the whitepaper functions not as a simple explanation, but as the starting point for legal judgment. The contents of a whitepaper serve as key evidence in determining how a project was structured, what assumptions underpinned its design, and what representations were made to users or investors. The assumption that “having a whitepaper makes a project lawful” is therefore highly dangerous. If, at an early stage, a project adopts or modifies the structure of Bitcoin without proper legal review, and the actual operational model differs from what was explained to investors, such conduct may be evaluated as deceptive. In particular, where a project promises principal protection or high returns while in practice paying earlier participants using funds from later investors—a so-called Ponzi scheme—fraud charges may be established (see Seoul High Court Decision, Aug. 7, 2020, Case No. 2020No596). From this point onward, the matter clearly exceeds the limits of what an individual or business can assess on its own. For those losing sleep over these concerns, meaningful solutions do not begin with technology, but with a legal perspective. Risks That Arise When the Whitepaper and Actual Operations Diverge Problems arise when elements that do not exist in the Bitcoin whitepaper are added during real-world business operations. Typical examples include discrepancies in profit-sharing methods, reward mechanisms, or the identity of the actual operator compared to what is described in the whitepaper. When technical explanations and business operations are not clearly separated—particularly where multi-level membership recruitment structures or principal-guarantee arrangements are involved—the structure may constitute violations of the Act on the Regulation of Conducting Fund-Raising Business Without Authorization or the Door-to-Door Sales Act. Furthermore, if high returns are promised to investors despite the absence of any realistic ability to generate such returns, fraud liability may arise. The extent to which discrepancies between a whitepaper and actual operations are legally tolerable is assessed from the standpoint of investor protection and transactional fairness. Legal liability is especially likely to arise in cases such as the following: The whitepaper describes a decentralized structure, but in reality a specific entity controls token issuance and distribution The technical development plan or business model stated in the whitepaper is false or lacks any realistic feasibility Investor returns are sourced not from genuine business revenue but from funds contributed by new investors Accordingly, without legal review at the whitepaper drafting or reference stage, projects may later face liabilities that are extremely difficult to manage or unwind. Issues That Become Critical During Investigations and Trials Investigative authorities and courts do not focus on the technical sophistication of a Bitcoin whitepaper. Instead, the following issues are central: Substance of fund flows: whether investor funds were used as described in the whitepaper, or diverted to pay returns to earlier investors Identification of responsible parties: who actually planned and operated the business, and whether the individual was merely an investor or a de facto operator Existence of return guarantees: whether principal protection or fixed returns were promised, and whether there was any actual capacity to honor such promises Simply asserting that a project “referred to the Bitcoin whitepaper” does not constitute a viable defense. The initial design of the structure and the manner in which it was presented to investors directly translate into legal responsibility. Beginning a response only at the investigation or trial stage is often already too late. In crypto-related fraud cases, the Act on the Aggravated Punishment of Specific Economic Crimes may apply. Where the amount obtained through deception exceeds KRW 5 billion, punishment may include life imprisonment or imprisonment for not less than five years. Where unauthorized fund-raising or multi-level marketing structures are combined with such conduct, enhanced penalties under multiple statutes may apply (see Suwon District Court Decision, Sept. 23, 2022, Case No. 2022No1558). For this reason, legal review by qualified professionals is essential from the business-structure design stage. Why Legal Interpretation of the Bitcoin Whitepaper Is Essential Ultimately, how a Bitcoin whitepaper should be interpreted, and how far it may be reflected in an actual business model, is a quintessential legal judgment. Decent Law Firm conducts an integrated review of: the original intent of the Bitcoin whitepaper the actual business and operational structure fundraising and reward mechanisms regulatory and investigative perspectives Through this approach, we provide not merely isolated advice, but consistent legal support that spans from structural design to dispute resolution and investigation response. Issues surrounding the Bitcoin whitepaper are not matters of technical debate—they are questions of legal liability. This is precisely where the involvement of professionals with substantial experience in virtual asset cases becomes indispensable.
2026-02-02 Naver Blog -
Blogs Crypto
A Legal Guide by a Pseudo-Investment Advisory Lawyer
The Decisive Difference Between Pseudo-Investment Advisory Business and Investment Advisory Business Many operators run paid “signal groups” or trading rooms on platforms such as KakaoTalk or Telegram relying solely on a pseudo-investment advisory business registration. However, in actual legal assessments, the most critical issue is individualization. A pseudo-investment advisory business provides non-personalized, general investment information to an unspecified audience through publications, broadcasts, or online postings. In contrast, an investment advisory business offers customized advice tailored to a specific individual’s investment profile, which requires formal registration with the Financial Services Commission. Following the 2024 amendment to the Capital Markets Act, structures in which operators receive compensation and directly exchange opinions with users online are increasingly likely to be classified as investment advisory services. Accordingly, responding to member questions in paid groups by specifying particular stocks or precise buy/sell timing carries a high risk of being deemed unregistered investment advisory activity, subject to criminal penalties. Key Prohibited Practices Operators Must Avoid In investigations and disputes, the following conduct most frequently becomes problematic: First, providing individualized investment advice. The moment an operator gives a member a tailored instruction such as “Do not average down on this stock,” it may constitute a violation of the prohibition on unregistered investment advisory services. Second, guaranteeing profits or covering losses. Statements such as “principal guaranteed” or “fixed monthly returns of 5%” may themselves violate the Capital Markets Act and can result in up to three years’ imprisonment or fines of up to KRW 100 million. Third, false or exaggerated advertising. Posting fabricated profit screenshots, impersonating investors, or claiming superiority over competitors without objective evidence may escalate into fraud charges. Mandatory Compliance Measures and Internal Controls When operating signal groups or investment-information services, the following points must be clearly disclosed on websites, notices, and pinned messages: No one-to-one consultations or asset management services are provided Investment losses are possible and responsibility rests solely with the investor The operator is a registered pseudo-investment advisory business, not a licensed financial investment company In addition, pseudo-investment advisory registrations must be renewed every five years. Failure to complete mandatory education or having a prior violation of financial laws may result in rejection of the registration. For virtual asset (cryptocurrency) signal groups, the Virtual Asset User Protection Act applies. Engaging in insider trading, market manipulation, or unfair trading practices may lead to severe criminal penalties, including imprisonment of one year or more. In particular, pump-and-dump schemes involving coordination with specific projects are currently under intensive regulatory scrutiny. Why Legal Support from Decent Law Firm Matters Decent’s virtual asset and financial regulation team goes beyond simple registration assistance, providing comprehensive management of legal risks across the entire business structure. Formation and operational advisory We design service structures, terms of use, and advertising language to ensure compliance within the scope of pseudo-investment advisory regulations. Criminal investigation defense We respond to allegations of unregistered advisory services, fraud, or unfair trading by developing legal arguments focused on the absence of conspiracy and fraudulent intent. Civil dispute representation We handle investor damage claims by structuring defenses based on the validity of limitation-of-liability clauses and comparative negligence principles. In an evolving regulatory environment, compliance must begin before issues arise, not after enforcement actions commence. If you are concerned about legal risks related to operating a pseudo-investment advisory business or signal group, we recommend consulting with a specialized lawyer for a proactive legal review.
2026-01-28 Naver Blog -
Blogs Crypto
Stock Trading Chat Room Scam Victims: If You Feel Lost About What to Do First, Read This
The First Thoughts After Realizing You’ve Been Scammed by a Stock Trading Chat Room Many clients who come to our firm feel overwhelming frustration and self-blame, unable to clearly distinguish whether what happened was merely an investment loss or a case of fraud involving deception. In most cases, operators of stock trading chat rooms argue along the lines of: “I never forced anyone,” or “Investing is entirely at your own risk.” These responses often further cloud a victim’s judgment, especially after losses have already occurred, leaving them unsure where to begin. However, choosing the wrong response strategy at this stage can lead to irreversible disadvantages later in both criminal proceedings and civil recovery efforts. Where Victims Inevitably Get Stuck When Acting Alone The first major obstacle victims face when trying to respond on their own is determining whether the case qualifies as a criminal matter or is merely a civil dispute. Online searches rarely provide clear standards, and in many cases, the materials victims gather are insufficient to function as legally admissible evidence. Even when victims prepare chat screenshots, bank transfer records, or voice messages, these materials often lack evidentiary value or fail to capture the critical elements needed to prove deception. In practice, many complaints end with decisions of “no charges” or “non-indictment,” most commonly because the evidence was insufficient to establish fraudulent intent. Chat logs from group chats, Telegram messages, text messages, and audio files are often submitted without proper organization or legal context. This is precisely where stock trading chat room fraud cases reveal the clear limits of handling matters alone. How to Respond to Stock Trading Chat Room Fraud The key factors in distinguishing simple investment losses from criminal fraud include: Whether there were deceptive acts, such as false profit guarantees or fabricated success records Whether losses were intentionally concealed Whether there was a repeated, organized structure designed to induce investment Immediately after discovering the damage, the most important step is not emotional confrontation but systematic collection and organization of evidence. Materials related to the chat room must be organized chronologically with clear context, and bank deposit and withdrawal records should be arranged to clearly demonstrate the full flow of funds. At the same time, potential civil recovery measures—such as claims for damages—should be reviewed alongside criminal complaints. As time passes, evidence becomes harder to secure, and proving deception and causation becomes increasingly difficult. Early, structured response is therefore critical. Practical Strategies for Recovering Damages At Decent Law Firm, we do not stop at drafting a criminal complaint. We analyze the operational structure of the chat room, its profit model, and the flow of funds to assess whether the overall structure constitutes fraud. This includes reviewing potential accomplices and interconnected schemes. Decent Law Firm handles cases through the following approach: Analysis of the fraud structure Evidence organization and preservation Criminal defense and prosecution strategies at each investigative stage Review of realistic civil recovery options Full representation through investigation and trial From the victim’s perspective, it is essential to make a sober assessment of whether the case is realistically actionable and the extent to which recovery can be expected.
2026-01-26 Naver Blog -
Blogs Crypto
Must-read if you want to avoid punishment for violating Korea’s Anti-Money Laundering Law
Why anti–money laundering (AML) cases become a problem The Act on Reporting and Using Specified Financial Transaction Information (the “Specified Financial Information Act,” often called the AML Act) is a core law aimed at preventing money laundering (AML) by regulating money-laundering activities and the financing of public-intimidation/terroristic acts through financial transactions. This law is not so much a statute that directly punishes the act of money laundering itself; rather, it focuses on regulating the financial transaction order through measures intended to prevent money laundering—such as reporting obligations for financial institutions, customer due diligence (KYC) obligations, and reporting/registration obligations for virtual asset service providers (VASPs). Because of this, cases repeatedly arise in which a person becomes a target of investigation for alleged AML law violations even though they did not directly commit a crime, simply because they failed to exercise sufficient caution regarding the source of funds or the structure of the transaction. Recently, in practice, issues often arise in situations involving virtual asset (crypto) transactions, movement of funds using corporate accounts, and intermediary/relay structures involving third parties. Even if a transaction appears normal on the surface, legal risk can arise if the origin and flow of funds are not clear. In what situations can you become implicated in a violation of the AML law? Violations of the Specified Financial Information Act are intent crimes, meaning punishment requires proof of intent. However, intent includes not only direct intent, but also dolus eventualis (reckless/conditional intent). If a person recognizes the possibility that the criminal result may occur and internally accepts that risk, intent may be found. This is determined not only by the actor’s statements, but by a comprehensive evaluation of specific circumstances, including the external form of conduct and the situation. Lending your financial account to another person or providing an access medium (e.g., authentication tools) may constitute a violation of the Electronic Financial Transactions Act (Article 49(4) of that Act). In addition, if you assist someone in conducting financial transactions under another person’s real name for the purpose of an evasive or unlawful act, you may be liable as an aider for a violation of the Act on Real Name Financial Transactions and Confidentiality (Financial Real-Name Act) (Article 6(1) and Article 3(3) of that Act). However, under the Financial Real-Name Act, an “evasive/unlawful act” must rise to a level comparable to the concealment of illegal assets, money laundering, financing of public-intimidation/terroristic acts, or evasion of compulsory execution. There is case law holding that simply being used as an account to receive fraud proceeds from electronic financial fraud is, by itself, difficult to regard as an “evasive/unlawful act” (Incheon District Court, Feb. 11, 2022, Decision 2021No3685). That said, in practice, there have been many cases where something appeared to be a normal investment settlement or payment for services, but was judged to be a channel for transferring illegal funds, triggering an investigation. In particular, when repeat transactions, large amounts, and a complex transaction structure are intertwined, criminal suspicion becomes much stronger. Key response points you must consider if you become implicated Money-laundering-related crimes punish not only principal offenders but also aiders and abettors. Therefore, even if you did not directly obtain or store criminal proceeds, you may be punished as an accomplice if you engaged in conduct that facilitated money laundering. For aiding/abetting liability to be established, the principal’s crime must satisfy the statutory elements and be unlawful, and the aider must have intent to assist along with awareness that the principal’s conduct constitutes an act meeting the elements of the offense. However, in AML cases, what matters more than whether you committed a formal act is how you were involved in the flow of funds and whether you could have recognized what was happening. In practice, factors like the following are reviewed comprehensively: Whether you committed specific acts that constitute money laundering or aiding/abetting money laundering Whether you knew, or could have known, that the funds were criminal proceeds or other illegal assets Whether your involvement was merely part of routine 업무 (work-related involvement), or whether you had an intent to facilitate money laundering In virtual asset cases, whether you fall under the Specified Financial Information Act’s definition of a “virtual asset service provider (VASP)” and whether you fulfilled the reporting/registration obligations Also, the fact that the transaction structure looked normal does not, by itself, negate legal responsibility. In areas such as virtual asset transactions, the use of corporate accounts, and third-party relay structures, the key standard is substance over form—the reality, not the appearance. Financial transactions or virtual asset transactions conducted in Korea are subject to the Specified Financial Information Act. Even if the transaction occurs overseas, it may still fall under the Act if it is conducted through Korean financial institutions or virtual asset service providers. Assistance from Descent Accordingly, Descent Law Office approaches AML cases not as a simple response to allegations, but through a structure-focused analysis. Reflecting the characteristics of virtual asset and corporate transactions, the firm reviews fund flows and each party’s role in a multidimensional way, and from the early stages of an investigation, establishes a response strategy that considers both criminal and civil risks. Based on extensive practical experience in similar cases, the firm provides realistic defense direction rather than merely formal advice. In AML matters, outcomes can vary greatly depending on the timing and manner of response, and early choices can determine the course of the case. Before it is too late, consult a professional expert first.
2026-01-19 Naver Blog -
Blogs Crypto
Referral Marketing: Outcomes Depend on How It Is Conducted
Referral Marketing Is Not Always Illegal Referral marketing originates from the basic marketing concept of “recommendation.” If a service or platform is introduced on a one-time basis and a reward is received accordingly, it may be assessed as legitimate promotional activity. However, referral marketing may raise legal issues if it operates in any of the following ways: A structure in which profits are generated step-by-step and on a continuing basis depending on the referrer’s performance in recruiting downstream members or their trading results; or Monetary transactions occur without any genuine exchange of goods or services; or Funds are solicited while guaranteeing high returns. In such cases, legal issues may arise under the Act on Door-to-Door Sales, etc. (including multi-level marketing or sponsored door-to-door sales), the Act on the Regulation of Conducting Fund-Raising Business without Permission, or criminal fraud provisions. The key point is that even when the same label—“referral marketing”—is used, legal evaluation can vary significantly depending on how the operation is actually structured. In legal assessments, the crucial factors include whether rewards are paid in stages based on downstream recruitment or trading performance, whether there is a genuine transaction of goods or services, and whether the individual was substantively involved in member recruitment and management. Key Factors That May Lead Referral Marketing to Criminal Liability Whether referral marketing leads to legal sanctions is not determined by a single factor. During investigations and trials, authorities comprehensively examine the following elements: Nature of the Revenue Structure Whether compensation is merely a sign-up bonus, or whether differentiated rewards are paid based on downstream recruitment results, trading volume, or organizational hierarchy, is a critical consideration. The more the structure resembles performance-linked compensation rather than simple referrals, the higher the likelihood of legal scrutiny. Repetition and Continuity of Conduct Authorities assess whether the activity was a one-time introduction or whether the same member recruitment activities were repeated over a long period. Under the Act on Door-to-Door Sales, whether an activity is conducted “as a business” is determined by considering repetition, continuity, and profit motive together. Degree of Involvement After User Acquisition Beyond merely providing a sign-up link, it is important whether the individual substantively participated in explaining the business structure or compensation scheme, recruiting or managing downstream members, or handling inquiries and complaints. If such involvement is established, the scope of liability may expand. Role and Function Within the Overall Structure Regardless of formal titles, authorities comprehensively review the actual functions and roles performed within the organization, such as member recruitment, business explanations or training, downstream organization management, and commission payments. Common Misconceptions in Referral Marketing Cases One of the most common misconceptions is the belief that liability can be avoided simply because the individual did not directly hold or handle funds. However, in cases involving multi-level marketing or sponsored door-to-door sales, authorities focus less on fund custody and more on: The individual’s substantive role within the organization The degree of involvement in member recruitment and management The extent of contribution to operating the compensation structure Another frequent misunderstanding is that using overseas platforms or foreign entities automatically avoids the application of Korean law. In reality, if members are recruited in Korea, business structures are explained to Korean users, or compensation is paid domestically, Korean laws—including the Act on Door-to-Door Sales—may still apply, regardless of the platform’s or entity’s location. Some also believe that modifying the structure or deleting related materials after issues arise will eliminate legal liability. However, in matters involving multi-level marketing or sponsored door-to-door sales, legal responsibility is assessed based on the structure and conduct at the time the acts occurred. Post hoc structural changes or document deletions do not extinguish liability for already completed offenses and may instead give rise to additional legal issues, such as destruction of evidence under Article 155 of the Criminal Act. Decent’s Approach: What to Review Now in Referral Marketing Matters In referral marketing cases, early-stage organization and assessment directly influence future legal outcomes. In particular, the following points should be carefully reviewed: Differentiating roles by specific acts and time periods Organizing facts based on substance rather than form Setting a response strategy before the scope of liability is fixed Understanding how early 대응 impacts final outcomes Referral marketing may appear, on the surface, to be a simple promotional activity. However, actual legal judgments are always based on structure, role, and degree of involvement. Many individuals later find themselves overwhelmed with anxiety, thinking, “I didn’t realize it could become this serious.” If the issue is taken lightly or postponed, it may lead to unexpected legal liability, which should never be ignored. Because it is essential to accurately identify the structure, clarify roles by timeline, and establish a response strategy suited to the current situation, we strongly recommend conducting an early, expert-level review of your circumstances.
2026-01-15 Naver Blog -
Blogs Crypto
Legal Counsel for Cryptocurrency Investment Fraud Investigations
Police Investigation Stage: Key Issues, Defense Strategy, and Attorney’s Fees Not all disputes arising from cryptocurrency investments lead to criminal prosecution. Under Korean criminal law, fraud is established only where there is clear evidence that the accused had intent to deceive from the outset. Mere investment losses or business failure do not, by themselves, constitute criminal fraud. In investigative practice, authorities tend to focus on cases involving patterns such as: Investment solicitations disguised as private sales, Guarantees of principal or fixed high returns, or Repeated promises of unrealistically high profits. However, where actual investment execution took place and losses resulted from changes in market conditions, such cases may be more appropriately classified as civil disputes involving breach of contract, rather than criminal offenses. Ultimately, police investigations into alleged cryptocurrency investment fraud revolve around two core issues: Whether there was intent to deceive at the time of solicitation, and How the invested funds were actually used. Rights of a Suspect During a Police Investigation A police investigation is not a procedural formality. It is a decisive stage that often determines whether a case proceeds to indictment and how subsequent criminal proceedings unfold. A suspect is guaranteed the right to remain silent under the Constitution and the Criminal Procedure Act. There is no obligation to answer every question, particularly where the facts are unclear or where an answer may be unfavorable. Investigative authorities are legally required to inform suspects of this right. In addition, a suspect has the right to assistance of counsel (Article 243-2(1) of the Criminal Procedure Act). A defense attorney may assist from the pre-investigation stage, organize the direction of statements, attend police questioning, and intervene where questioning becomes improper or coercive. In cryptocurrency-related cases—where transaction structures, wallet movements, and technical elements are complex—the involvement of counsel during questioning often plays a decisive role. Where arrest or detention occurs, the suspect may request judicial review of its legality. Overnight interrogations and excessively long questioning sessions are strictly restricted by law. Preparing for a Cryptocurrency Fraud Police Investigation The most important step prior to appearing for questioning is a systematic organization of the facts. Key materials may include: Cryptocurrency transaction histories, Investment agreements or offering documents, Communication records with investors, and Documentation tracing the flow and use of funds. Consistency in statements is critical. Providing spontaneous answers while memories are unclear may result in inconsistencies that later work against the suspect during prosecution or trial. Because written interrogation records are frequently treated as key evidence in court, any inaccuracies must be corrected immediately at the investigation stage. If investigators attempt to induce unfavorable statements or apply undue pressure, the suspect should exercise the right to remain silent and seek immediate assistance from counsel. Defense Strategy in Cryptocurrency Investment Fraud Cases Defense in cryptocurrency investment fraud cases must be based on structure and evidence, not emotion or unsubstantiated assertions. First, it is essential to demonstrate that actual investments were executed and that there was a genuine possibility of profit. This directly undermines allegations of deceptive conduct. Second, evidence showing the absence of intent to misappropriate funds—such as partial profit distributions, operating expenses, or documented investment use—serves as a key factor in rebutting criminal intent. Third, emphasizing the inherent volatility of cryptocurrency markets helps clarify that losses resulted from market risk rather than fraudulent conduct, reinforcing that the matter concerns civil liability rather than criminal responsibility. The Supreme Court has consistently held that the mere failure to return investment funds does not, by itself, establish criminal fraud. Why Early Legal Involvement Matters Once a police investigation begins on suspicion of cryptocurrency investment fraud, the criminal process is already underway. At this stage, early legal judgment and strategic involvement often determine whether a case proceeds to prosecution or concludes at the investigative level. Decent Law Firm’s Digital Asset Practice Team designs defense strategies that go beyond abstract legal theory, taking into account investigative structure, fund flow analysis, and the technical characteristics of digital assets. If you have received a police summons, it is critical to consult with legal counsel before appearing for questioning. In cryptocurrency investment fraud cases, the investigation stage often determines the final outcome.
2026-01-14 Naver Blog
