Hancom Chairman Faces Crypto Fraud Probe in South Korea

• Hancom Group Chairman Kim Sang-cheol faces elevated scrutiny over market manipulation allegations.
• Kim has been referred to South Korean prosecutors following a sequence of investigations and raids that started in 2021.
• Experiences revealed Kim’s involvement in organising a secret slush fund.

Software program firm Hancom Group Chairman Kim Sang-cheol is underneath investigation for allegedly amassing illicit funds value tens of billions of Korean received utilizing Arowana (ARW) tokens. South Korean prosecutors at the moment are reviewing the case following a sequence of investigations and raids that started in 2021.

The Arowana token is linked to Hancom With, a blockchain subsidiary of the Hancom Group. Experiences point out the blockchain agency has considerably invested in Arowana. The token launched on the South Korean crypto change Bithumb on April 20, 2021. Inside half-hour, the ARW value soared from 50 received to 53,800 received, a 1,075-fold soar.

Market Manipulation Issues and Allegations

The staggering rise of the token has raised considerations about market manipulation. Though Hancom, Arowana, and Bithumb denied the allegations, native police launched an investigation. Moreover, Kim was accused of embezzling large funds by way of the token.

In October 2021, leaked telephone calls allegedly revealed Kim’s involvement in organising a secret slush fund. The recordings supposedly contained proof of Kim claiming possession of Arowana by way of a clandestine contract. Nonetheless, Arowana disputed the allegations, claiming the decision recordings have been manipulated and edited with malicious intent.

South Korea’s Tightening Crypto Rules

The investigation continued as South Korea strengthened its regulatory framework. Lately, the nation handed its first consumer safety regulation to fight illicit crypto actions. The nation’s Monetary Supervisory Service (FSS) plans to implement stringent rules utilizing a joint response system to handle growing crypto threats.

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Moreover, the Monetary Companies Fee (FSC) approved the Digital Asset Safety Basis, a company created to safeguard clients’ belongings, particularly if an change fails. The inspiration will make sure the profitable return of belongings to clients even when the change collapses.