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Non-Referral DecisionCrypto
If You Were Reported for Fraud While Running a Crypto Referral — A Real Case of Non-Referral Decision
Our client worked at a cryptocurrency-related company, providing coin futures trading information to customers. When a complainant suffered forced liquidation after independently maintaining a high-leverage position, the client was reported to police on charges of fraud. The complainant alleged that our client had induced investment by implying guaranteed returns, and had concealed referral commission income earned through a crypto referral (exchange referral code) arrangement. DECENT's Virtual Asset Practice Team accompanied the client during police questioning from day one, and submitted two separate written defense opinions — arguing the absence of fraudulent intent and the lack of causal connection between our client's conduct and the complainant's losses. The police ultimately issued a non-referral decision on grounds of insufficient evidence.
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Non-Prosecution DecisionCrypto
Crypto Fraud & AML Act Violation Case
A virtual asset investment platform operator sold certain cryptocurrency tokens to retail investors. The tokens were marketed at prices significantly lower than the prevailing market price, with promotional claims suggesting that substantial profits could be expected once the tokens were listed on a Korean cryptocurrency exchange. However, the token prices later collapsed, and the anticipated exchange listing never materialized. As a result, numerous investors filed criminal complaints alleging fraud and illegal virtual asset business operations. Investigators viewed the token sales structure as a potential violation of Korea’s Act on Reporting and Use of Certain Financial Transaction Information (commonly referred to as the “Special Financial Transactions Act” or “AML Act”), particularly the registration requirements applicable to virtual asset service providers (VASPs). The authorities launched a broad investigation involving dozens of individuals, including employees engaged in token sales activities. Our clients were sales employees working for the platform operator. Although they had no ownership or managerial authority, they were suspected of participating in an organized crypto fraud scheme and sought legal assistance from Decent Law Firm’s Digital Asset Team.
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Non-Prosecution Decision (No Charges Filed)Crypto
Non-Prosecution (No Charges) in Crypto Copy Trading Fraud Allegations
The Digital Assets Practice Group at Decent Law Firm represented a client who had been accused of fraud and violations of the Act on the Protection of Virtual Asset Users in connection with crypto copy trading services. The client, while working at a cryptocurrency investment company, introduced spot and futures trading strategies and explained a copy trading service to the complainant, whom he had met through a YouTube channel. The complainant later signed up with an exchange and participated in the copy trading program. After incurring investment losses, the complainant filed a criminal complaint, alleging that the client had deceived him from the outset with the intent to collect fees without any genuine intention to generate profits. The client consistently maintained that he had repeatedly disclosed the risks of investment, the leveraged trading structure, and the applicable fee system, and that there had been no intent to deceive or misappropriate funds.
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Decision of Non-transfer (Acquittal on All Charges)Crypto
Successful Defense Against Charges of Professional Breach of Trust and Trade Secret Misappropriation
The Decent Law Firm Virtual Asset Special Task Force successfully represented a client accused of Professional Breach of Trust, Violation of the Commercial Act (Special Breach of Trust), and Violation of the Unfair Competition Prevention and Trade Secret Protection Act. Through our proactive legal intervention during the investigative stage, we secured a Decision of Non-transfer (Acquittal/No Charges) for all counts. The client was a former executive at a virtual asset-related company. After the client resigned to start a new venture, the former employer faced financial difficulties and sent a notice of claim for damages, followed immediately by a criminal complaint. The charges were severe, carrying the risk of heavy imprisonment. The complainant alleged that the client had arbitrarily settled referral commissions (rebates) from the Bitget exchange, leaked company funds to third parties, and misappropriated a proprietary trading indicator, which they claimed was a protected trade secret.
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Police Decision of Non-Referral (Dismissal due to La...Crypto
Police Decision of Non-Referral in Crypto Exchange Fraud Case
The Decent Law Firm Virtual Asset Task Force successfully defended a client accused of fraud related to cryptocurrency investment solicitations. Through proactive legal advocacy during the investigation stage, we secured a "No Suspicion" decision, preventing the case from being transferred to the prosecution. The client, a professional in the investment sector, was sued by acquaintances after introducing them to a specific virtual asset exchange. The accusers claimed that the client colluded with the exchange to promote an unregistered platform, promising a 30% deposit bonus and guaranteed withdrawals without the intent or ability to fulfill those promises. The case involved USDT worth approximately 18 million KRW.
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Quasi-Investment Advisory Service Agreement DeliveredCrypto
Quasi-Investment Advisory Subscription Service Agreement — Legal Review
Decent Law Firm's virtual asset team advised a startup planning to launch a premium monthly subscription service offering stock and cryptocurrency investment information. The service was structured around hidden research content, institutional buying and short-selling analysis indicators, insight publications, Telegram live sessions, and offline meetups — priced at several hundred thousand Korean won per month. Given the nature of the service, two regulatory frameworks applied simultaneously: quasi-investment advisory regulations under the Financial Investment Services and Capital Markets Act, and digital content and subscription service rules under the E-Commerce Act. The client needed a comprehensive review to determine whether their existing agreement was sufficient and how to reduce exposure to criminal, administrative, and civil liability.
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Delivery of a Legal Review Opinion on Virtual Asset ...Crypto
NFT & Virtual Asset Distribution Structure: Legal and Tax Advisory
Decent Law Firm's Virtual Asset Practice represented a company operating in the Web3 ecosystem — providing planning, branding, distribution, and monetization consulting for creators' original works through virtual asset-based structures. The firm provided comprehensive legal and tax advisory on the distribution of NFT auction proceeds and the appropriate tax treatment of those funds. The client had received NFT auction proceeds in stablecoins through an overseas auction platform and recognized that distributing those funds between the creator and the company carried significant legal and tax risk. They engaged Decent for structured guidance. A further complication: under current Korean regulations, it remains practically difficult for general for-profit corporations to open a corporate real-name account at a domestic exchange for virtual asset transactions. Access is being permitted only in limited, phased stages in line with the financial regulator's roadmap — making legally compliant operational structures an urgent priority.
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Delivery of a Formal Legal Opinion on the Legality o...Crypto
Legal Review of Crypto Referral Services in South Korea: VASP Status and Compliance
The Virtual Asset Task Force at Decent Law Firm represented a marketing company operating a business model centered around cryptocurrency exchange referral codes in South Korea. We conducted a comprehensive legal audit to ensure their operations complied with the Act on Reporting and Using Specified Financial Transaction Information (the "Specified Financial Information Act") and other local virtual asset regulations. The client operates online platforms (YouTube, blogs, SNS) providing guides on virtual asset trading and exchange usage. Their revenue model involves distributing referral codes and receiving commissions for new user acquisitions. As South Korean financial authorities have recently tightened their interpretation of "brokerage" activities, the client faced an urgent need to mitigate the risk of criminal penalties for "unregistered business operations" and to establish a legally compliant operational scope. Decent Law Firm’s specialized team cleared the regulatory ambiguity and provided a Compliance Guideline Package that the client could immediately implement.
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Delivery of a Legally Structured Consulting Agreemen...Crypto
Legal Advisory on a Contract for Crypto Arbitrage Infrastructure Consulting Services
The client, a virtual asset consulting service provider (Mr. A), requested legal review and drafting of a consulting agreement for a service designed to help customers build an environment for cryptocurrency arbitrage between domestic and overseas exchanges. The service structure included guidance on exchange account operation, procedures for overseas remittances, and education on automated trading programs so that customers could independently conduct arbitrage trading. Crypto arbitrage services may involve multiple overlapping regulatory frameworks, including the Foreign Exchange Transactions Act, the Capital Markets Act, and the Act on Reporting and Use of Certain Financial Transaction Information (AML Act). If the contractual structure is improperly designed, it may expose the service provider to potential criminal or administrative risks, such as unregistered foreign exchange services, illegal investment advisory activities, or violations of the Act on the Regulation of Conducting Fund-Raising Business Without Permission (similar to illegal deposit-taking schemes). To ensure regulatory compliance and minimize potential disputes with customers, the client sought legal assistance from Decent Law Firm’s Digital Asset Team.
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Delivery of an Independent AML External Audit Report...Crypto
Preparation of an Independent AML External Audit Report for a Virtual Asset Exchange
A domestic virtual asset exchange (“Company A”) engaged Decent Law Firm to conduct an independent external audit of its Anti-Money Laundering (AML) framework, as required under the Act on Reporting and Using Specified Financial Transaction Information (the “Special Financial Transactions Act”) and Article 15 of the Operational Regulations on Anti-Money Laundering and Counter-Terrorist Financing (the “Operational Regulations”). Under the Special Financial Transactions Act, Virtual Asset Service Providers (VASPs) are obligated to establish and maintain an AML system and to undergo an independent review at least once annually. Amid increasing regulatory scrutiny from supervisory authorities, Company A sought an objective assessment of whether its AML framework complied with current legal and regulatory standards and to proactively identify potential compliance risks. For this purpose, the company retained Decent Law Firm’s Digital Asset & Virtual Asset Practice Group.
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Provision of a Legal Listing Opinion for an Overseas...Crypto
Preparation of a Legal Listing Opinion for the Domestic Exchange Listing of an Overseas-Issued Utility Token
An overseas blockchain project company (“Company A”) sought to list its utility token on a domestic virtual asset exchange in Korea. The token issued by Company A was designed for functional use within a Layer 2 blockchain ecosystem based on decentralized identity (DID) and digital trust infrastructure. It was structured to be used solely for functional purposes such as access to platform services and participation in network operations. In Korea, virtual asset exchanges conduct a critical regulatory review during the listing process to determine whether a token qualifies as a “security” under the Financial Investment Services and Capital Markets Act (the “Capital Markets Act”). If classified as an investment contract security, the token cannot be listed or distributed on a domestic exchange without compliance with securities registration and licensing requirements. To proactively address these regulatory risks and secure a formal legal listing opinion for submission during the exchange review process, Company A engaged Decent Law Firm’s Digital Asset Practice Group.
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No Referral to Prosecution (No Charges Filed)Crypto
No-Charge Decision in Alleged Unregistered Virtual Asset Business Case Related to Crypto Referral Activities
The client was an individual engaged in a cryptocurrency exchange referral (affiliate marketing) program when they unexpectedly became involved in a criminal investigation. The complainant had been recruited through an investment scam group’s so-called “trading signal room” and was encouraged to participate in copy trading on an overseas cryptocurrency exchange. In the course of this process, the complainant transferred approximately KRW 80 million to the client’s account for the purpose of purchasing virtual assets. After suffering investment losses, the complainant filed a criminal complaint alleging that the client was both a co-conspirator in an investment fraud scheme and an unregistered Virtual Asset Service Provider (VASP) in violation of the Act on Reporting and Using Specified Financial Transaction Information of Korea (the “Specified Financial Information Act”).
