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Media CoverageFraud Crimes Increased by 10% in the First Half of This Year, 'Online Scams Using Platforms like Telegram Surge'
The number of fraud crimes reported to the prosecution in the first half of this year increased by 10% compared to the same period last year. Experts have analyzed that fraud through social networking services (SNS) such as Telegram and Naver Band has surged. (omitted) Experts noted that scams using platforms like Telegram, Naver Band, and KakaoTalk open chat rooms have become more frequent, leading to a significant increase in victims. While messengers like Telegram were previously used mainly by younger people, more older users have recently joined, resulting in scams targeting people of all ages. Two prominent examples are stock-leading chat room scams and romance scams. Stock-leading room scams involve promising high returns and deceiving victims by claiming to share stock information. Victims are lured into paying to join paid chat rooms with the promise of receiving premium information, only to have hundreds of thousands of won stolen. Romance scams involve fraudulent activities disguised as romantic relationships. A recent example is the case of Jeon Cheongjo, who scammed former fencing national team member Nam Hyun-hee. Other common tactics include scammers posing as foreign military personnel or refugees, sending messages like "I want to come to Korea" or "I want to meet you" to lure victims into sending money. In online scams, while victims often send money via bank transfers, experts have noted an increase in cases where payments are made in virtual assets, making it nearly impossible to recover the stolen funds. Pureun “Ian” Hong, managing partner at Decent Law Firm, commented, "Recently, a wide variety of scams have surged on platforms like open KakaoTalk chat rooms, Telegram, and Naver Band. The common characteristic of these scams is that the perpetrators introduce themselves in an unverifiable online setting and then ask for money. People should be cautious about sending money to individuals they cannot verify."
2024-09-11 Financial News -
Blogs
Supreme Court Ruling: Legal Characteristics and Specificity of Virtual Assets in South Korea
The Supreme Court of South Korea has defined virtual assets as "digital representations of economic value that are not controlled by the state but are granted value through blockchain or other encrypted distributed ledgers, qualifying as property benefits" (referencing Supreme Court Decision 2021Do9855, November 11, 2021). The Court emphasized the distinct characteristics of virtual assets, such as the ability to verify only the addresses of electronic wallets without identifying the user's personal information, and the distributed recording of transaction histories, which set them apart from traditional assets. Furthermore, the Supreme Court noted that virtual assets are not subject to the same level of regulation as legal tender and involve inherent risks in transactions. Consequently, the Court concluded that virtual assets do not warrant the same level of legal protection as legal tender under criminal law.
2024-09-10 X (Twitter) -
Media Coverage
Unregistered Operator BTCC Engages in Illegal Activities Again: 'Korean Language Support and KRW Deposits Available'
It has been revealed that the unregistered virtual asset service provider (VASP) BTCC is promoting Korean language support and KRW transfers while proposing partnerships to domestic blockchain companies. On August 27, it was confirmed that BTCC sent an email to domestic blockchain company A on the afternoon of August 26, offering a partnership with BTCC, which supports the Korean language and accepts KRW deposits. (omitted) Hyeonsu “Elliot” Jin, managing partner at Decent Law Firm, pointed out, "KRW deposits, card usage, and bank account registration could potentially violate the Act on Reporting and Using Specified Financial Transaction Information (Special Act) and the Electronic Financial Transactions Act." Jin further stated, "Since BTCC has not obtained a business license under the Special Act, it seems clear that they are operating illegally." He added, "Since card companies block virtual asset payments, it's unlikely that payments will be processed normally, and there is a risk of involvement in money laundering through illegal means such as bypass payments."
2024-08-28 Digital Asset -
Media Coverage
Coin Exit Scam Delio Shifts Loss Responsibility to Users by Amending Terms and Conditions
Delio, a virtual asset deposit service currently on trial for the '2.5 billion won coin exit scam,' has been accused of secretly amending its terms and conditions to avoid responsibility for deposit losses, shifting the burden to users. Initially, the company attracted users by promising to guarantee the principal, but without notice, it altered the terms to make users responsible for any losses. Legal experts have pointed out that if the terms were changed in a way that disadvantages users, the revised terms should not be applied retroactively to existing users. According to the virtual asset industry on the 14th, Delio recently submitted its 'virtual asset deposit service terms and conditions' to the Seoul Bankruptcy Court, where its bankruptcy proceedings are underway. The last amendment to these terms was made in September 2022, and it includes a clause assigning the responsibility for deposit losses to users. Article 5, Clause 2 of the terms states that 'all responsibility for losses incurred from deposit products invested in at the user’s discretion shall be borne by the user.' (omitted) Legal experts criticized Delio for failing to uphold its moral responsibility as a virtual asset service provider. Typically, when financial institutions amend terms and conditions in a way that disadvantages users, they do not apply the changes retroactively to existing users. However, if a financial institution seeks the consent of users for the amended terms, even disadvantageous provisions may be applied retroactively, according to legal opinions. Pureun “Ian” Hong, managing partner of Decent Law Firm, stated, "Since Delio's deposit service terms were amended in a way that disadvantaged users, Delio should have sought user consent for those changes."
2024-08-14 ChosunBiz -
Media Coverage
Will a Path Open for Terra · Luna Coin Fraud Victims to Be Compensated?
As the extradition of Kwon Do-hyung, the key figure behind the Terra-Luna crash, to Korea approaches, victims are closely watching to see if the domestic compensation process will be expedited. Legal experts believe that if Kwon is tried in Korea, his expected sentence may be significantly lower than if he were tried in the U.S. However, there is also speculation that it may be easier for Kwon to reach settlements with victims during the trial process. (omitted) According to industry reports, the global damage from the Terra-Luna collapse is estimated to be around 50 trillion KRW, with about 200,000 domestic victims suffering losses of approximately 300 billion KRW. The Seoul Southern District Prosecutors' Office, which is investigating Kwon, has filed a claim for asset preservation based on the "Act on the Confiscation and Recovery of Corrupt Property," and the court has approved the preservation of about 233.3 billion KRW of Kwon's assets. Experts view Kwon's extradition to Korea as a positive development for victim compensation. Pureun “Ian” Hong, managing partner of Decent Law Firm, commented, "It is clear that Kwon will face criminal charges in Korea for fraud and violations of the Capital Markets Act, and most of the related proceedings, such as the bankruptcy trials of Terraform Labs Korea, will take place in Korea. Since Kwon will need to focus on compensating victims to receive a lighter sentence, this could put domestic victims in a somewhat more favorable position compared to overseas victims."
2024-08-04 Financial News -
Media Coverage
Nation’s First 'Virtual Asset Spot ETF' Listing in Progress
Efforts are underway to list virtual asset spot exchange-traded funds (ETFs) for Bitcoin, Ethereum, Solana, and Ripple in Korea. According to the financial investment industry on the 7th, PVR Group has submitted a business proposal to Busan Technopark, a public institution under Busan City, aiming to establish core projects and regulatory exemptions for the blockchain regulatory free zone. The key content includes the listing of virtual asset spot ETFs and trading of K-content tokens. Busan Technopark is responsible for managing major projects in the Busan Blockchain Regulatory Free Zone. Based on business proposals from 16 companies, including PVR Group, Busan City plans to hold a general meeting this month to discuss key projects and regulatory exemptions for the blockchain regulatory free zone. (omitted) Hyeonsu “Elliot” Jin, the managing partner of Decent Law Firm, specializing in virtual assets, commented, "If this is pursued as a regulatory sandbox project, it can move forward quickly because it's not about changing the law but allowing temporary, limited, and trial-based operations. Since investments will be made through securities firms and asset management companies, this could help popularize virtual asset investments while also having a positive impact in terms of security and skilled personnel."
2024-07-07 Asia Economy