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| June 20, 2018

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investigation Archives -


Tekashi69 Under Investigation for Role in Chief Keef Shooting

June 18, 2018 |

Cops are taking a hard look at Tekashi69 to see what, if any, role he played in the events leading up to the attempted shooting of Chief Keef … TMZ has learned. Law enforcement sources say NYPD wants to see if Tekashi has any…


Mario Batali Under Criminal Investigation for Sexual Misconduct: Report

May 21, 2018 |

Mario Batali is reportedly being investigated by the NYPD for sexual misconduct after a woman came forward on ’60 Minutes’ to claim he’d sexually assaulted her.  Anderson Cooper spoke to a handful of women Sunday, one of whom anonymously…

Trump Demands Investigation of ‘FBI Spying’ on Campaign

May 21, 2018 |

President Trump took another leap into uncharted territory Sunday with a demand for the Justice Department to investigate whether the FBI infiltrated his 2016 campaign. Trump tweeted that he would officially demand Monday that the department “look into whether or not the FBI/DOJ infiltrated or surveilled the Trump Campaign for…

Investigation of South Korea’s Largest Crypto Exchange Upbit Continues

May 16, 2018 |

Investigation of South Korea’s Largest Crypto Exchange Upbit Continues

Since the South Korean prosecution started investigating Upbit, the country’s largest cryptocurrency exchange, more events have unfolded. While local media still discuss allegations and raise questions about Upbit’s business practice, some people believe that Upbit is already in the clear. The investigation continues.

Also read: Yahoo! Japan Confirms Entrance Into the Crypto Space

The Allegations

Investigation of South Korea’s Largest Crypto Exchange Upbit ContinuesLocal media reported on Friday that South Korea’s largest cryptocurrency exchange, Upbit, is under investigation for alleged fraud. More information has surfaced since, casting doubt on whether the allegations can be considered fraud. No charges have been filed against Upbit at the time of this writing. However, the prosecutors have confiscated the exchange’s computers and records as part of the investigation.

On Monday, News1 Korea described:

Prosecutors searched Upbit for fraud charges triggered by coinless transactions, suspicion of insider trading during the listing process, and allegations of money laundering and leakage of money through US trading sites.

Liquidity Issue

Investigation of South Korea’s Largest Crypto Exchange Upbit ContinuesThe first allegation, the most heavily scrutinized, concerns the liquidity of some of the coins listed on Upbit.

The exchange currently lists 137 cryptocurrencies but not all of them have wallets. South Korean prosecutors are accusing the exchange of “book-trading” where Upbit facilitates the trading of cryptocurrencies without actually having the coins in its possession. Joongang Ilbo elaborated:

Of the more than 130 cryptocurrencies currently traded on Upbit, about 40 do not support e-wallets.

News1 also pointed out that there is a viewpoint among investigators that if users request a transfer or withdrawal of their coins all at once, then Upbit will not be able to return their money immediately, which would render the original transactions fraudulent.

However, some argue that “most domestic trading sites are adopting this method” except those that handle a small number of cryptocurrencies such as Bithumb, the news outlet conveyed, adding that if this method is found to be an “apparent fraud…[then] the industry will not be much affected.”

Upbit Calls It a Misunderstanding

Upbit says that this investigation is “something that comes from misunderstanding,” Joongang Ilbo reported.

Investigation of South Korea’s Largest Crypto Exchange Upbit ContinuesThe exchange has repeatedly dismissed the above accusation, emphasizing that it will secure the needed cryptocurrencies as soon as it has brokered a transaction for the coins without a wallet, the news outlet detailed. In addition, Upbit insists that it has “never bought or sold cryptocurrencies that it did not own since it opened last October.”

Furthermore, given Upbit’s exclusive partnership with the US exchange Bitrex, crypto experts believe that “the lack of understanding of the Upbit trading system that links the system with the overseas exchange has led to the suspicion of book trading,” the publication emphasized, adding:

Cryptocurrency traded in KRW is directly managed by Upbit, and when customers buy other virtual currencies…transactions are made through Bittrex under the responsibility of Upbit.

A representative of another crypto exchange explained that except for the won market, Upbit transactions are made through Bittrex. “It is a legitimate book deal, and the prosecutors seem to have misunderstood why they are selling cryptocurrencies that they do not have.”

Previous Internal Audit

Another factor at play is an article published by Money Today on Tuesday, referencing an internal audit which reportedly happened earlier this year. The news outlet quoted Lee Seok-woo, president of Dunamu Inc. which operates Upbit, saying that “In early March, when Upbit was suspected of only [conducting] book transactions without [holding the] coins…I have been notified that the amount of coins [in the books] is 100% identical to the number of coins” in the wallets.

Referencing the above article, Twitter user Crypto of Korea wrote, “Upbit claimed that they had the internal account audit…The audit shows that 100% of the coins are real, the ledgers all synced to their own wallets.”

Investigation of South Korea’s Largest Crypto Exchange Upbit Continues

Some people subsequently took Upbit’s claim as the exchange being clear of wrong-doing in this current investigation, while others remain more objective. Twitter user Nash wrote, “Not concluded yet. It’s just “Upbit’s claim.” Meanwhile, Korean media still raise questions about Upbit’s operations and seek more answers at the time of this writing.

Insider Trading and Money Laundering Concerns

The prosecutors are also reportedly looking into allegations of insider trading and money laundering surrounding Upbit, News1 Korea wrote, noting that “some investors have raised strong suspicion that there is insider trading” at the exchange. “It is suspected that a person who receives information from an Upbit employee about an upcoming listing [on Upbit] would have bought the cryptocurrency from [an] overseas trading site and sold on Upbit.”

Furthermore, the investigators alleged that “illegal business funds are more easily transferred from the domestic [exchange] to the US due to the linkage with Bittrex,” the publication described.

As for any fraud charges, a lawyer was quoted by the news outlet commenting:

It is difficult to judge it as a fraud because there is no victim. If the capital market law applies to the transaction site [Upbit], it is a criminal offense. The lack of a clear baseline law is a bigger problem.

Joongang Ilbo further asserted that according to the position of the country’s financial regulators, “cryptocurrency is not subject to the Capital Market Law because it is not a monetary product.” In the unlikely event that the prosecutors can apply the Capital Market Law to this case, commissions through book transactions would be considered criminal proceeds, the news outlet explained.

Do you think Upbit has done anything wrong? Let us know in the comments section below.

Images courtesy of Shutterstock, Twitter, and Upbit.

Need to calculate your bitcoin holdings? Check our tools section.

The post Investigation of South Korea’s Largest Crypto Exchange Upbit Continues appeared first on Bitcoin News.

Bitcoin News

Korean Regulators Widen Investigation of Cryptocurrency Exchanges

May 14, 2018 |

Korean Regulators Widen Investigation of Cryptocurrency Exchanges

South Korea’s government is widening its probe on cryptocurrency exchanges, particularly the use of corporate accounts which the regulators say can lead to money laundering. This announcement follows the prosecutors launching an investigation on the country’s largest crypto exchange, Upbit.

Also read: Yahoo! Japan Confirms Entrance Into the Crypto Space

Widening the Crypto Probe

South Korea’s top financial regulators are teaming up with prosecutors to widen their investigation of domestic cryptocurrency exchange operators. An official of the Financial Service Commission (FSC) was quoted by the Korea Times on Sunday:

Following a request by the Financial Supervisory Service (FSS) and the prosecution to address growing anti-money laundering compliance concerns and possible abuse of cryptocurrencies in money laundering and fraud, the FSC is looking into exchanges’ corporate accounts opened in local banks.

The use of corporate accounts for crypto transactions should have been discontinued when the government introduced the real-name system at the end of January. However, only 30% of all crypto accounts haveKorean Regulators Widen Investigation of Cryptocurrency Exchanges been converted into real-name ones so far.

The six banks that have the ability to issue real-name accounts have chosen to only service the country’s largest crypto exchanges: Upbit, Bithumb, Coinone, and Korbit. Nonetheless, not all accounts at these exchanges have been converted into real-name ones. In addition, all small and medium-sized exchanges continue to use corporate accounts for crypto transactions.

The regulators say that the use of corporate accounts can lead to fraud such as recently seen with Coinnest whose CEO was charged with embezzlement. The largest Korean crypto exchange by volume, Upbit, is also currently under investigation even though banks have been converting its accounts to real-name ones.

Collaborating with Other Countries

Korean Regulators Widen Investigation of Cryptocurrency ExchangesSouth Korea has been discussing a collaboration with other countries on cryptocurrency regulations. At a recent International Organization of Securities Commissions (IOSCO) Board of Directors and Annual General Meeting held in Hungary, FSC Vice Chairman Kim Yong-beom discussed cryptocurrency issues with major national supervisory bodies. The need for IOSCO to cooperate on cryptocurrency and ICO regulations was stressed at the meeting.

An official of the FSC was quoted by the Korea Times saying:

The FSC is collaborating with authorities in other countries. Our latest findings show that the domestic exchange faked its balance sheets and deceived investors. The FSC is checking Upbit’s computer system with prosecutors and the FSS to audit the exchange’s virtual currency holdings.

Meanwhile, the new FSS governor Yoon Suk-heun recently indicated that he will look into easing regulations on domestic cryptocurrency trading, citing that “there are some positive aspects to cryptocurrencies.”

What do you think of the Korean regulators widening probe on crypto exchanges? Let us know in the comments section below.

Images courtesy of Shutterstock and the Korean government.

Need to calculate your bitcoin holdings? Check our tools section.

The post Korean Regulators Widen Investigation of Cryptocurrency Exchanges appeared first on Bitcoin News.

Bitcoin News


Adidas Under Investigation for Employee Injury at Kanye Yeezy Office

May 14, 2018 |

Adidas could be facing stiff penalties after an employee’s grisly injury at Kanye West’s Calabasas office — where his Yeezys are designed — is being investigated by OSHA … TMZ has learned. We broke the story … an Adidas employee was working on…

South Korea’s Largest Crypto Exchange Upbit Under Investigation for Fraud

May 11, 2018 |

South Korea's Largest Crypto Exchange Upbit Under Investigation for Fraud

The largest cryptocurrency exchange in South Korea, Upbit, is suspected of fraud and is currently under investigation. The prosecutors have conducted searches at the exchange and confiscated computers and accounting records.

Also read: Yahoo! Japan Confirms Entrance Into the Crypto Space

Upbit Under Investigation

South Korea’s largest cryptocurrency exchange, the Kakao-backed Upbit is suspected of fraud, according to local media. While maintaining that customers’ assets are still kept securely, the exchange posted the following statement on its website:

Upbit is currently under investigation by the prosecution, and we are working diligently. Upbit services such as all transactions and withdrawals are operating normally.

South Korea's Largest Crypto Exchange Upbit Under Investigation for FraudUpbit is currently the world’s fourth-largest cryptocurrency exchange and the largest in South Korea with a 24-hour trading volume of $ 1.812 billion at the time of this writing, according to Coinmarketcap. The exchange is affiliated with Kakao Corp which operates the country’s most popular chat app, Kakao Talk.

Suspected of Fraud

Crypto of Korea explained:

The company [Upbit] is suspected of transferring customer funds from their cryptocurrency exchange account to a representative or executive account…Korean prosecutors have conducted search and seizure against the nation’s largest cryptocurrency exchange, Upbit, on charges of fraud.

South Korea's Largest Crypto Exchange Upbit Under Investigation for FraudAccording to the publication, the financial investigation team of the Seoul Southern District public prosecutors’ office sent prosecutors and investigators to Upbit headquarters on May 10 and May 11 “to secure computer hard disks and accounting records.” More than 10 investigators were sent to Upbit, Money Today added.

“After the digital forensics investigation on the seizures [seized items] and confirming the illegal charges, we will decide whether and in what direction we will investigate further,” the prosecutors were quoted saying.

Accused of Deceiving Customers

Upbit allegedly “pretends to hold [virtual currencies] without holding virtual currencies,” the news outlet noted.

South Korea's Largest Crypto Exchange Upbit Under Investigation for Fraud“The prosecution believes that Upbit has entered [into] the computer system as if it had virtual currencies that it does not actually own, and deceived customers,” KBS elaborated. According to the prosecution, the Hankyoreh described, “Upbit has been suspected of carrying out ‘book-trading’ without holding virtual currencies in a wallet.”

The Financial Services Commission (FSC) and the Financial Supervisory Service (FSS) have been investigating domestic crypto exchanges since March, according to Yonhap News. Their first target was Coinnest where the chairman, Kim Ik-hwan, was detained over embezzlement and fraud charges. According to Money Today, unlike Coinnest, there is no suspicion of embezzlement with Upbit.

Do you think Upbit is guilty? Let us know in the comments section below.

Images courtesy of Shutterstock and Upbit.

Need to calculate your bitcoin holdings? Check our tools section.

The post South Korea’s Largest Crypto Exchange Upbit Under Investigation for Fraud appeared first on Bitcoin News.

Bitcoin News

NBC News Investigation Weighs In on Lauer’s Button

May 9, 2018 |

NBC News’ internal investigation following Matt Lauer’s firing says it doesn’t believe there is a culture of sexual harassment at the division and that current management wasn’t aware of Lauer’s behavior until the complaint that doomed him, reports the AP . NBC Universal was criticized for turning to its general counsel,…

Swiss 1MDB Investigation Turns to PetroSaudi Officials

May 2, 2018 |

Swiss prosecutors have launched criminal proceedings against two officials at PetroSaudi International related to alleged dealings with 1MDB, in an escalation of the Swiss probe that started nearly three years ago. What’s News Europe

Huawei Under Criminal Investigation Over Iran Sanctions

April 26, 2018 |

The Justice Department is probing whether Huawei violated U.S. sanctions related to Iran, opening a new avenue of scrutiny amid national-security concerns over the Chinese technology giant. What’s News Asia