- Executives from South Korean exchange Coinbit have been arrested by police as part of a wash trading investigation
- The exchange’s offices were raided in August and an arrest warrant was issued following police interviews with the suspects in October
- The Coinbit execs are accused of wash trading almost $100 million between 2019 and 2020
Executives from Korean cryptocurrency exchange Coinbit have been arrested by the prosecution team for the Seoul Metropolitan Police Agency on market manipulation charges. The case dates back to August when Coinbit’s offices in Gangnam, Seoul were raided as part of an investigation into wash trading. The arrests, which took place last week, appear to be related to this investigation, with owner and chairman Choi Mo among those currently being questioned by prosecutors.
$92 Million Wash Trading Accusations
Coinbit’s problems began four months ago when police accused their executives of facilitating the wash trading of 100 billion won ($92 million) between 2019 and 2020, which resulted in the August office raid.
Police accused staff of moving funds between “ghost accounts” on the platform and other misdemeanors involving IEOs, with Choi himself accused of instructing his team to trade large quantities of specific tokens to increase the price before dumping them on unsuspecting users.
Coinbit Execs Denied Involvement
Coinbit exchange executives denied the allegations at the time, saying that rogue employees acted under their own steam and claiming to have reported these individuals to the police, although the arrests of Choi and his executive team would suggest that police are not satisfied with these claims.
News1 Korea broke the news of the arrests which actually took place on December 5, revealing that the suspects in the case were actually interviewed by police in October before applying for arrest warrants, which were seemingly granted.