South Korea’s V Global scandal, one of the country’s biggest crypto fraud cases, has reached another chapter as three accomplices received suspended sentences. These individuals played a role in the $1.4 billion scheme that defrauded around 50,000 customers, leaving long-lasting financial and emotional impacts. The case has been ongoing since 2021 and continues to serve as a reminder of the risks investors face when trading on unregulated platforms.

Suspended Sentences and Fines

The Daejeon District Court’s Cheonan Branch found three unnamed individuals guilty of violating the Act on the Aggravated Punishment of Specific Economic Crimes. The court sentenced them to three years in prison, but the sentences were suspended, meaning they will avoid jail time if they comply with five years of probation.

Each was ordered to pay substantial fines: 660 million won ($474,000) for a 61-year-old woman, 426 million won ($306,000) for another 63-year-old woman, and 259 million won ($186,000) for a 57-year-old man. Prosecutors said these individuals occupied top positions in multi-level marketing operations that recruited customers to V Global, reportedly earning up to 1.5 billion won ($1.1 million) each in profits.

Court’s Rationale

The presiding judge acknowledged the massive scale of the crime, calling the damage to society “considerable” and noting that over 50,000 victims continue to deal with the financial and psychological effects. However, the judge also pointed out that the defendants ensured some payouts to victims, a factor that contributed to the suspended sentences rather than immediate imprisonment.

Background of the V Global Fraud

V Global operated from mid-2020, presenting itself as a legitimate crypto exchange with a professional-looking trading platform complete with price charts, tickers, and trading volumes. The exchange used a tiered membership system, promising payouts in its own token, “V Cash”, for recruiting new members. Investigations later revealed that these tokens were fake and never launched on any blockchain.

The scheme collapsed in 2021 when users reported being unable to withdraw their funds. South Korean authorities conducted raids at 22 locations, froze approximately 240 billion won in company accounts, and launched a wide-scale investigation.

In earlier rulings, V Global’s CEO, Lee Ben-gyu, was sentenced to 22 years in prison and fined 106.4 billion won ($87.5 million). Six other top managers received prison terms ranging from four to 14 years. One of them is currently serving a 14-year sentence, and another is nearing the end of a four-year term.

Broader Implications for Investors

The V Global case continues to underscore the importance of due diligence in crypto investing. While some perpetrators are facing prison terms and others, like the recent trio, are receiving suspended sentences, victims are still waiting for full financial recovery. The case is widely cited as one of the largest frauds in South Korea’s crypto history and has shaped public perception of the industry.

Related read: Crypto Scam: South Korean Police Bust Fake Exchange Ring

A Clear Lesson on Crypto Safety

V Global accomplices sentenced to suspended terms mark a partial closure to this major fraud case, but its impact will linger for years. The case serves as a clear reminder that investors must be cautious when selecting trading platforms. In South Korea’s fast-growing crypto market, choosing regulated and trustworthy exchanges in South Korea is critical to avoid falling victim to similar scams.