Operator who embezzled 7 billion KRW in 'virtual character trading scam' sentenced to 5 years in prison

The operator who deceived members into believing they could make profits by running a P2P-based virtual character site was sentenced to five years in prison.

The Supreme Court's 2nd Division (Presiding Justice Lee Dong-won) announced on the 7th that it upheld the original sentence of five years in prison for Mr. A, who was indicted on charges including violation of the Act on the Aggravated Punishment of Specific Economic Crimes (fraud).

Mr. A sold three types of virtual characters to members, promoting that after holding them for three days, they could sell the characters to other members at profit rates of 12%, 15%, and 18%, respectively, according to the company's matching system.

However, the structure required characters to be split once their price reached a certain amount, which increased the number of characters. Therefore, in the long term, it was impossible to continuously recruit new members to purchase the endlessly splitting characters.

Nonetheless, Mr. A deceived members by claiming that if they purchased characters, held them for a certain period, and then sold them to other members at a higher price, they could earn long-term profits, thereby shifting the company's burden of paying profits onto the members.

He also directly participated in character transactions using accounts registered under false names, pretending these were regular member transactions, attracting members and embezzling sales proceeds and transaction fees.

It was found that Mr. A caused massive damages amounting to approximately 7 billion KRW from 64 victims through these methods.

The first and second trials stated, "The defendant knew that the platform was structurally unsustainable, yet promoted to victims that they could earn profits by purchasing and burning characters with company funds," and sentenced him to five years in prison.

The Supreme Court also agreed with the lower courts' judgment.