South Korean authority arrests Bithumb owner on $50M embezzlement charges
Investigations revealed that Kang Jong-hyun is the brother of Kang Ji-yeon who is the head of Inbiogen-an affiliate that holds about 34.2% stake in Bithumb.
Kang Jong-hyun, the owner of the Bithumb exchange, has been arrested for allegedly embezzling roughly $50 million, according to local news JTBC.
Executives of the South Korean-based crypto exchange have been in facing fraud charges in recent times. For example, former Chairman Lee Jung-hoon was accused of misappropriating about $70 million from his deal with BK Group chairman Kim Byung-Gun.
Following investigations into the allegations against Jung-hoon, it was uncovered that the little-known Kang Jong-hyun is the exchange owner.
Korean news outlet JTBC reported on Feb. 2 that the Seoul Southern District Court has issued an arrest warrant against Kang Jong-hyun.
Jong-hyun was arrested alongside two Bithumb executives for fraud, stock manipulation, and embezzlement of corporate funds worth 60 billion won – approximately $50 million.
Further investigations revealed that Jong-hyun is the elder brother of Kang Ji-yeon, the head of Inbiogen, an affiliate with about 34.2% stake in Bithumb.
The duo allegedly conspired to manipulate the stock prices of Inbiogen and embezzled corporate funds to the tune of ₩60 billion.
Jong-hyun denied the embezzlement allegations, stating that he has no relation to the company as he no longer has a stake in them.
Kang Ji-yeon added that the claims against his brother were “unconfirmed.” However, he would cooperate with the authorities in the investigation.
Meanwhile, South Korea’s National Tax Service (NTS) said it was probing the tax affairs of Jong-hyun and Kang Ji-yeon to uncover possible tax evasion and money laundering.