The head of Delio, a centralized finance (CeFi) lending platform, has been sentenced to 15 years in prison by a South Korean court for his role in a $50 million fraud scheme affecting over 1,100 investors.
A South Korean court found Mr. Jeong guilty of embezzling digital assets.
According to local news outlet Newsis, the CEO, Mr. Jeong, was convicted of defrauding investors, leading to a hefty loss of approximately 70 billion won in virtual assets. Delio, which declared bankruptcy in November 2024, had attracted deposits of bitcoin and ether by promising high returns but abruptly ceased customer withdrawals on June 14, 2023.
The Seoul Southern District Court stated, "While operating Delio, the defendant falsely obtained a virtual asset trading license and defrauded victims of approximately 70 billion won in virtual assets." Initially, prosecutors had sought a 20-year sentence and alleged that 2,800 individuals had been defrauded. However, many pieces of evidence were dismissed by the court due to procedural issues raised by the defense, which is expected to appeal the ruling.
This case adds to a series of high-profile crypto fraud prosecutions within South Korea, including the infamous collapse of Terraform Labs’ TerraUSD (UST) and Luna token, which resulted in significant financial losses for investors. Notably, in 2022, seven executives from the crypto exchange V Global were sentenced to prison for a fraud scheme that defrauded investors of $1.7 billion, with the former CEO receiving a 22-year sentence.