Delio CEO Sentenced to 15 Years for Fraud Involving $49 Million

Summary

• Jeong Sang-ho, CEO of the South Korean cryptocurrency platform Delio, has been sentenced to 15 years in prison for fraud.
• The court found him guilty of defrauding around 1,100 clients of approximately 70 billion won (about $49 million), while the initial charges involving more victims were dismissed.
• The ruling comes after the court deemed evidence collected during a server search as inadmissible, significantly weakening the prosecution's case.

In a significant legal development, Jeong Sang-ho, the CEO of Delio, has been sentenced to 15 years in prison following the collapse of his cryptocurrency deposit platform. The Seoul Southern District Court delivered the verdict on Thursday, which is notably five years less than the sentence sought by prosecutors. The case has attracted attention due to the scale of the fraud and the legal intricacies involved.

The court ruled that evidence collected from Gabia, the hosting service for Delio’s servers, was obtained illegally, which led to the dismissal of the main charges that implicated Jeong in defrauding approximately 2,800 individuals of around 250 billion won ($176 million). Instead, he was convicted on alternative charges involving about 1,100 victims and 70 billion won ($49 million), which prosecutors had prepared as a contingency in light of the evidence issues.

Jeong was also found guilty of fraudulently registering Delio as a virtual asset service provider, having submitted a falsified report that exaggerated the company's cryptocurrency assets by roughly 47.6 billion won (about $34 million). The court highlighted that Jeong had misappropriated over 70 billion won from clients while promoting Delio as a cryptocurrency bank despite its operational failures.

In mitigation, the court acknowledged that external circumstances contributed to the platform's downfall and noted that Jeong did not have a history of serious prior convictions. The initial verdict, originally set for mid-July, was delayed due to concerns over the evidence presented, ultimately leading to the prosecution's adjustment of charges.

Delio had gained traction by offering attractive interest rates on cryptocurrency deposits but was forced to halt withdrawals in June 2023 and subsequently ceased operations in August after failing to secure necessary court approvals. The platform was declared bankrupt in November 2024, marking a dramatic fall from its previous prominence in the digital asset space.