Korean Authority Indicts Upbit’s Executives for Fraud

The exchange has allegedly raked more than 120 billion won by creating false orders.

South Korea’s top crypto exchange Upbit has been accused of manipulating transactions and creating fake orders worth 254 trillion won (around $226 billion), as reported by Korea Times.

Three officials from Upbit, including a board chairman and a financial director, have been indicted by the Seoul Southern District Prosecutor’s Office on Friday. They are alleged to have falsified the transactional data of the exchange to rake around 122.1 billion won (around $106.8 million). According to the prosecutors, the alleged party sold 11,550 bitcoins to around 26,000 customers.

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The case was brought to the country’s prosecution by the Financial Services Commision (FSA). According to the FSA, Upbit had manipulated the transactional data twice between October 2017 to December 2017 and then again on December 18 this year.

The agency suspects that the exchange had used a bot program to inflate the number of its digital coin transactions. It further alleged that the exchange had boasted the value of underperforming coins to attract investors towards them.

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“I’m worried about investors who may lose money in this market because of exchanges like Upbit. We need a way to make the market and the industry fair and transparent,” Korean Times quoted an FSA official.

Upbit’s Denial

Upbit, however, in a press release, denied all the allegations.

“Upbit, as a corporate body, has never liquidated any assets acquired via fraud or used fraudulent assets to make further transactions,” the exchange stated in the press release. “We will fully cooperate with the prosecution’s investigation to show the allegations are totally false.”

According to CoinMarketCap, Upbit is currently the third largest crypto exchange in the word handling trades worth more than $997 million in a span of 24 hours. And it is certainly the largest exchange in the lucrative South Korean market.

Earlier this year, Upbit conducted a third-party audit by the Yoojin Accounting Corporation after a sudden raid by local authorities. The audit showed full solvency as the exchange’s reserves ratio stood at 103 percent and cash ratio at 127 percent.

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