Suwon District Prosecutors' Office Recovers Cryptocurrency Crime Proceeds, Returns to National Treasury... First Domestic Case

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[Asia Economy Reporter Seongpil Cho] The Suwon District Prosecutors' Office (Chief Prosecutor Moon Hongseong) announced on the 1st that it has converted and confiscated approximately 12.2 billion KRW worth of Bitcoin seized as criminal proceeds from the operator of an illegal pornography site known as the "Second Soranet," and remitted the funds to the national treasury. This is the first time that Bitcoin, a virtual currency, has been confiscated, converted, and remitted to the national treasury through legal procedures.

According to the prosecution, the Supreme Court in May 2018 sentenced An Mo, the operator of the pornography site AVSNOOP, to 1 year and 6 months in prison after recognizing that he received Bitcoin as payment for illegal pornography downloads. The court also ruled that 191 out of 216 Bitcoins seized by the prosecution were criminal proceeds and ordered their confiscation. At that time, due to insufficient related laws, the prosecution was unable to take any action on the confiscated Bitcoins and kept them in an electronic wallet. However, following the enforcement of the amended "Act on Reporting and Using Specified Financial Transaction Information," which recognizes virtual currencies as assets on the 25th of last month, the prosecution sold the Bitcoins and remitted approximately 12.294 billion KRW to the national treasury.

A prosecution official stated, "This is the first case in which criminal proceeds in the form of virtual assets have been effectively confiscated and converted to the national treasury within the criminal justice system," adding, "We will thoroughly track and recover criminal proceeds in the form of virtual currencies to completely block incentives for concealing criminal proceeds."