Two high-ranking executives of Komid, a Korean cryptocurrency exchange were sentenced to imprisonments on charges that they falsified trading volumes on the exchange.
Choi Hyunsuk, CEO of Komid and his subordinate in-house director Park Mo were sentenced to three-year and two-year terms in jail, respectively on charges that they inflated the exchange’s daily trading volumes in what’s called as “wash trading”.
The wash trading is an industry jargon that describes a stream of fake transactions aimed at artificially and falsely boosting daily trading volumes to manipulate prices of cryptocurrencies traded on the exchange.
The wash trading is the most widely used scam in Korea to artificially manipulate daily trading volumes.
Back in December, 2018, executives with Danamu, an owner of Korean cryptocurrency exchange Upbit were indicted with alleged charges that they had manipulated daily trading volumes placing false orders. The charges
According to the final judgements, Choi and his subordinate created five accounts on the exchange and placed false orders to sell and buy through the accounts to artificially jerk up daily trading volumes. Choi was also blamed for installing ‘bot’ on the exchange platform to make the exchange look busy with tones of orders.
Prosecutors claimed on the charges that both of the two executives fabricated 5 million transactions on the exchange and allegedly pocketed US$45 million out of the scam