The South Korean authorities have charged the management of the Coinbit cryptographic exchange with market manipulation.
According to News1, the prosecutor’s office is investigating Coinbit Chairman Choi Mo and two other top managers and accusing them of fraud and forgery of documents related to market manipulation.
The Seoul Police Department reported that three suspects used fake accounts from August 2019 to May 2020 to overestimate transactions and manipulate token prices.
In the August raids, police found that 99% of the volume of the exchange was falsified through the trading of Bitcoins (BTC) and other cryptographic currencies, and those responsible for the fraudulent activities earned over $84 million.
The investigation revealed that Coinbit did not provide data on deposits and withdrawals on major cryptovoltaic transactions. It concluded that the Coinbit chairman and his team were manipulating the market by buying and selling large numbers of tokens at certain times.
Under South Korean law, engaging in fraudulent trading practices, such as providing inaccurate market prices, carries imprisonment ranging from five years to life imprisonment, especially if the profit generated by the fraud exceeds 5 billion won (approximately $4.6 million). In addition, those responsible may be fined on the amount of the profit made.