Crypto Fraud & AML Act Violation Case

Client Information

Individual / Suspect
 

Case Details

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.

✔️ Full Participation During Police Interrogations
Our attorneys accompanied the clients throughout the investigative process from the earliest stage of the case, ensuring that their procedural rights were protected and preventing inaccurate or unnecessarily incriminating statements.


✔️ Detailed Analysis of the Token Sales Structure
We demonstrated that the clients acted merely as employees under the direction and supervision of management and had no practical authority over the operation, structure, or decision-making of the platform.
The defense focused on distinguishing the clients from the actual operators and organizers of the business.


✔️ Legal Arguments Regarding the AML Act
Our legal team conducted a detailed analysis of the statutory definition of a virtual asset service provider under Korean law, along with relevant precedents and regulatory interpretations.
We argued that simple sales employees who neither controlled nor operated the business could not be treated as regulated VASPs subject to criminal liability under the AML framework.


✔️ Comprehensive Review of Investigation Records
Because the investigation involved a large number of suspects and extensive records, we conducted a thorough review of the evidence to clarify the limited scope of the clients’ involvement and the absence of criminal intent.
We emphasized that the clients lacked awareness of any alleged illegality and did not participate in managerial or financial decision-making.