Illegal XRP Exchange Operator Jailed for Eight Years in South Korea

An illegal XRP exchange operator has been sentenced to eight years in prison in South Korea after defrauding investors of nearly $3.4 million. The unnamed operator stole almost $2 million from one individual, according to prosecutors in a trial at the Seoul High Court. The court upheld the verdict of a Seoul District Court, which earlier sentenced the operator to 12 years in prison, Namdo Ilbo reported.

However, the High Court judge ruled that the operator had taken steps to compensate one of their victims, and so reduced the sentence accordingly. The operator can now accept the verdict or appeal the judgment at the Supreme Court. The High Court heard that the accused became the CEO of a "domestic cryptocurrency exchange" in 2015.

The exchange "advertised" that it had "signed a formal supply agreement with" the XRP token issuer Ripple and Ripple Labs. In 2015, an individual referred to as B (for legal reasons) sent the exchange fiat worth around $2 million. The CEO told B they could pay 20% less than the market rate for the coins.

However, the CEO convinced B to keep the coins on the exchange's platform. In 2017, the exchange told B that he could boost his XRP 2.35 million holdings to 3 million in three months. B was told they could do so by lending the coins to another victim (C). The coins were worth around $700,000 at the time, the media outlet reported.