Criminal
Crypto Auto-Trading Software Operator — No-Crime Decision on Fraud & FSTRA Charges
사건 개요
- Client Information
- Individual / Suspect
- Case Details
-
The client developed and operated a subscription-based automated cryptocurrency trading software.
The complainant used the program to invest directly through their own exchange account, but incurred losses following a sharp market downturn.
Despite the client's repeated advice to cut losses, the complainant refused and continued holding positions until liquidation.
The complainant subsequently filed a criminal complaint alleging that the client had induced investment through false representations of profitability, bringing charges of fraud and violation of the Act on Reporting and Using Specified Financial Transaction Information (FSTRA).
디센트 전략
Decent Law was retained before the suspect interview took place and remained involved throughout the entire investigation.
On the fraud charge, the Korean Supreme Court has held that fraud requires deception, a resulting mistake, a disposition of property induced by that mistake, acquisition of financial gain, a causal link between these elements, and intent to illegally appropriate — and that whether deception and causation exist must be assessed objectively, taking into account the specific circumstances of the transaction, as well as the counterparty's knowledge, experience, and background (Supreme Court Decision 2011Do8829, October 13, 2011, and others).
Defense counsel submitted a written opinion to the investigator addressing the following points in detail.
▪️Validity of the signed risk disclosure agreement: The agreement, signed by the complainant in their own hand, expressly stated that all decisions regarding which assets to trade, when to trade, and how much to invest rested solely with the customer, and that the company bore no responsibility for trading outcomes. The complainant signed after being given sufficient opportunity to review the terms.
▪️Absence of deception and causation: The client had informed the complainant that the program was available free of charge until a 100% return threshold was reached, and had proactively disclosed the risks of loss prior to any investment. The client derived no financial gain from the complainant's losses.
▪️Complainant as the sole decision-maker: All deposits, withdrawals, and trading decisions were made directly by the complainant through their own exchange account. The client had no access to, and no control over, the complainant's account at any point.
On the FSTRA charge, Article 7(1) and Article 17(1) of the FSTRA impose criminal liability — up to five years' imprisonment or a fine of up to KRW 50 million — on virtual asset service providers that conduct virtual asset transactions as a business without filing a report with the Financial Intelligence Unit (FIU). The complainant argued that the client had been acting as an intermediary for virtual asset trading on the complainant's behalf.
Defense counsel countered that the software operated on a strictly non-custodial SaaS model: customer assets remained in the customer's own exchange account at all times, and the client held no authority to withdraw or manage those assets. Exchange deposit and withdrawal records, together with the software's technical design documentation, were submitted as supporting evidence.
On the fraud charge, the Korean Supreme Court has held that fraud requires deception, a resulting mistake, a disposition of property induced by that mistake, acquisition of financial gain, a causal link between these elements, and intent to illegally appropriate — and that whether deception and causation exist must be assessed objectively, taking into account the specific circumstances of the transaction, as well as the counterparty's knowledge, experience, and background (Supreme Court Decision 2011Do8829, October 13, 2011, and others).
Defense counsel submitted a written opinion to the investigator addressing the following points in detail.
▪️Validity of the signed risk disclosure agreement: The agreement, signed by the complainant in their own hand, expressly stated that all decisions regarding which assets to trade, when to trade, and how much to invest rested solely with the customer, and that the company bore no responsibility for trading outcomes. The complainant signed after being given sufficient opportunity to review the terms.
▪️Absence of deception and causation: The client had informed the complainant that the program was available free of charge until a 100% return threshold was reached, and had proactively disclosed the risks of loss prior to any investment. The client derived no financial gain from the complainant's losses.
▪️Complainant as the sole decision-maker: All deposits, withdrawals, and trading decisions were made directly by the complainant through their own exchange account. The client had no access to, and no control over, the complainant's account at any point.
On the FSTRA charge, Article 7(1) and Article 17(1) of the FSTRA impose criminal liability — up to five years' imprisonment or a fine of up to KRW 50 million — on virtual asset service providers that conduct virtual asset transactions as a business without filing a report with the Financial Intelligence Unit (FIU). The complainant argued that the client had been acting as an intermediary for virtual asset trading on the complainant's behalf.
Defense counsel countered that the software operated on a strictly non-custodial SaaS model: customer assets remained in the customer's own exchange account at all times, and the client held no authority to withdraw or manage those assets. Exchange deposit and withdrawal records, together with the software's technical design documentation, were submitted as supporting evidence.
결과 및 의의
" No-crime decision"
The investigating authority issued a no-referral decision — equivalent to a finding of no criminal liability — on both the fraud and FSTRA charges.
The decision was not based on insufficient evidence, but on the conclusion that the conduct did not constitute a crime under Korean law.
This outcome was significantly shaped by early legal intervention.
Defense counsel was present at the suspect interview to assist in structuring the client's responses, and the written opinion subsequently submitted laid out a clear, evidence-backed account of the software's architecture and the complainant's autonomous role in all investment decisions.
The investigating authority issued a no-referral decision — equivalent to a finding of no criminal liability — on both the fraud and FSTRA charges.
The decision was not based on insufficient evidence, but on the conclusion that the conduct did not constitute a crime under Korean law.
This outcome was significantly shaped by early legal intervention.
Defense counsel was present at the suspect interview to assist in structuring the client's responses, and the written opinion subsequently submitted laid out a clear, evidence-backed account of the software's architecture and the complainant's autonomous role in all investment decisions.
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사건의 주요 내용을 미리 남겨주시면 보다 구체적인 상담을 받으실 수 있습니다.
