Supreme Court Confirms 10-Year Prison Sentence for QRC Bank CEO in 200 Billion Won Cryptocurrency Scam Case

The CEO of QRC Bank and accomplices, who were indicted for a cryptocurrency pyramid investment scam involving 200 billion KRW, have been sentenced to heavy prison terms.

According to the legal community on the 19th, the Supreme Court's 3rd Division (Presiding Justice Ahn Cheol-sang) upheld the original sentence of 10 years imprisonment and an order to confiscate approximately 13 billion KRW from Go (42), the CEO of QRC Bank, who was charged with fraud, violation of the Act on the Regulation of Conducting Fund-Raising Business without Permission, and violation of the Act on Door-to-Door Sales, among other charges.

Supreme Court, Seocho-dong, Seoul.

The Supreme Court also confirmed the original sentence of 5 years imprisonment and an order to confiscate about 350 million KRW against Ahn, who served as CEO of an affiliated company and committed the crime together with Go.

The court explained the reason for dismissing the appeal, stating, "There is no error in the lower court's judgment that violates the rules of logic and experience or exceeds the limits of free evaluation of evidence, nor is there any misinterpretation of the law regarding joint principal offenders or confiscation under the Act on the Confiscation of Proceeds from Corruption."

Go was indicted on charges of deceiving investors by introducing QRC Bank as a "fintech-based digital bank providing payment, savings, remittance, and currency exchange services" from 2019 to 2020, and promising "to earn 300% of the principal by investing in cryptocurrency," thereby receiving investments totaling 227.7 billion KRW. Ahn and Kim, former CEOs of other affiliated companies who participated in the crime, were also prosecuted together.

They were investigated to have caused damage to more than 5,400 people by using a "Ponzi scheme" method, paying earlier investors with the money of later investors.

The first trial court sentenced Go to 10 years imprisonment, Ahn to 5 years, and Kim to 3 years. Fines of 10 million KRW each were also imposed on QRC Bank and two affiliated companies.

While the first trial court found most charges to be guilty, it did not accept the prosecution's request for confiscation of criminal proceeds.

The prosecution argued that out of the approximately 227 billion KRW received from investors between December 11, 2019, and July 14, 2021, about 225 billion KRW, excluding the amounts distributed to Ahn and Kim, should be confiscated.

However, the court rejected the prosecution's claim, citing that a significant portion of the investment funds received by Go was paid back to investors as dividends.

The court stated, "Based solely on the evidence submitted by the prosecution, it is difficult to determine the exact amount of profit actually obtained by the defendants, nor can it be considered specified. Therefore, the prosecution's request for confiscation does not meet the requirements, and it is reasonable not to confiscate under the Act on the Confiscation of Proceeds from Corruption."

However, the second trial court's judgment differed.

The court ruled, "This case is recognized as one where victim recovery is extremely difficult under the Act on the Confiscation of Proceeds from Corruption, fulfilling the requirements for confiscation and seizure," ordering Go to pay approximately 13 billion KRW, Ahn about 350 million KRW, and Kim 50 million KRW in confiscation.

The court noted, "The victims of this crime number over 5,000, and the damage exceeds 200 billion KRW, making it a very large-scale pyramid scheme. Due to issues such as reinvestment and returned profits, it is difficult to calculate the actual damage amount. It is also unlikely that victims will be fully compensated by the defendants, as it is difficult for victims to discover the defendants' criminal proceeds or enforce claims against their assets."

It continued, "Since this is an exceptional case where victims cannot exercise property return claims or damage claims against the defendants regarding the criminally obtained property, and victim recovery is extremely difficult, confiscation for victim restitution is permitted under Article 6, Paragraph 1 of the Act on the Confiscation of Proceeds from Corruption."

Article 6, Paragraph 1 of the Act on the Confiscation of Proceeds from Corruption (Special Provisions on Criminally Obtained Property) states, "If the property under Article 3 (confiscable corrupt property) is criminally obtained property and the victim cannot exercise property return claims or damage claims against the offender, making victim recovery extremely difficult, confiscation and seizure may be carried out."

However, the appellate court acquitted some charges that the first trial court had found guilty, reducing Kim's sentence to 2 years and 6 months imprisonment. Go and Ahn's sentences of 10 years and 5 years imprisonment, respectively, were maintained.

Go and Ahn appealed, but the Supreme Court found no issues with the appellate court's ruling.

This content was produced with the assistance of AI translation services.