• 05 December, 2024
Crypto Exchanges News

Arrest Warrant Issues Against Bithumb Owner of Stock Manipulation

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According to reports, an arrest warrant has been issued against Kang Jong-Hyeon, CEO of Bithumb, the largest cryptocurrency exchange in South Korea. Kang has been charged with fraud due to his alleged role in manipulating stock prices at many firms with ties to Bithumb.

Local media have reported that the Financial Investigation Division of the Seoul Southern District Prosecutor’s Office has filed charges of theft and breach of trust against Kang and two other executives of Bithumb affiliates. These claims come under the Capital Markets Act and the Act on the Aggravated Punishment of Specific Economic Crimes.

Two of the affiliate firms engaged in the lawsuit are Inbiogen and Bucket Studio, both of which are headed by Kang’s younger brother, Kang Ji-Yeon. He is also suspected of having a hand in manipulating Inbiogen and Bucket Studio stock prices through the issuance of convertible bonds.

Vidente, the primary stakeholder in Bithumb, was also implicated in the case, and probes were launched against the company in October 2022. With a 34.2% stake, Vidente is the largest stakeholder in Bithumb. Meanwhile,  Inbiogen is Vidente’s largest shareholder, while Bucket Studio is Inbiogen’s largest shareholder.

Legal problems continue

According to previous reports, Park Mo, the vice president of Vident, was found dead in Dongjak-gu, Seoul. Authorities noted the incident as suicide.  Prosecutors were looking into claims that the CEO had misappropriated money from Bithumb partners.

Meanwhile, on January 10th, tax authorities in Seoul’s Gangnam-gu neighborhood raided Bithumb’s headquarters to check on the centralized exchange’s compliance with cryptocurrency tax regulations.

Bithumb Korea, Bithumb Holdings, and their affiliates were under investigation by the tax authorities for possible tax evasion related to local and foreign activities. The investigation was led by NTS’s 4th Bureau of Investigation, which is part of the Seoul Regional Tax Service.

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