Summary
- Delio CEO Jeong Sang-ho received 15 years’ imprisonment for defrauding customers of approximately $49.2 million in cryptocurrency assets and embezzlement.
- Judges dismissed a separate $175.6 million fraud allegation involving 2,800 people because investigators illegally obtained crucial evidence supporting the charge.
- Delio suspended cryptocurrency withdrawals in June 2023, exposing financial difficulties that eventually resulted in the platform’s bankruptcy in November 2024.
Delio CEO Jeong Sang-ho has received a 15-year prison sentence for defrauding customers of approximately $49.2 million in cryptocurrency assets. According to Newsis, the Seoul Southern District Court found Jeong guilty of most charges involving roughly 70 billion won in customer funds.
Judge Jang Chan presided over the case, which involved fraud, embezzlement, and false documents linked to Delio’s regulatory registration. Prosecutors had requested a 20-year prison term based on the scale of losses and the number of customers involved.
However, judges imposed a 15-year sentence while emphasizing the seriousness of the financial crimes established during the trial. Moreover, the court noted that Jeong had not received forgiveness from customers who suffered significant financial losses. NoCut News separately reported that judges ordered Jeong into custody because they considered him a potential flight risk.
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Court Convicts Jeong Over $49 Million Crypto Fraud
Jeong’s conviction covers approximately 70 billion won, worth $49.2 million, in cryptocurrency assets belonging to Delio customers. Judges also convicted him of embezzlement involving assets entrusted to the cryptocurrency deposit platform.
Additionally, Jeong used false documents when registering the company as a virtual asset service provider, the court found. Judges described the crimes as extremely serious because of their methods, financial scale, and impact on numerous victims.
Significantly, Jeong avoided conviction on the largest fraud allegation included in the prosecution’s case. Prosecutors had accused him of defrauding about 2,800 people of nearly 250 billion won, equivalent to approximately $175.6 million.
However, judges acquitted Jeong of that allegation because investigators had illegally obtained evidence supporting the charge. According to Newsis, authorities collected the disputed evidence during a search and seizure involving a server operator.
Consequently, the court excluded that evidence when considering whether prosecutors had proven the larger fraud allegation. Despite that acquittal, the remaining fraud and embezzlement convictions resulted in Jeong receiving a lengthy prison sentence.
Delio’s Withdrawal Suspension Preceded Bankruptcy
Delio operated a cryptocurrency deposit platform that offered high returns to customers who placed digital assets with the company. Furthermore, the company promoted itself as a digital asset bank while attracting customers seeking returns on cryptocurrency deposits.
Delio suspended customer withdrawals in June 2023, leaving users unable to access cryptocurrency deposited through the platform. That suspension exposed serious financial problems and raised concerns about the company’s management of customer assets.
Delio’s financial difficulties eventually resulted in bankruptcy proceedings as customers remained affected by the platform’s collapse. Authorities declared the company bankrupt in November 2024, more than one year after its suspension. Jeong’s conviction now adds substantial criminal penalties to the financial consequences surrounding Delio’s collapse and customer losses.
Conclusion
Jeong’s 15-year sentence holds him responsible for $49.2 million in cryptocurrency fraud alongside embezzlement and false-document convictions. Although judges rejected the $175.6 million fraud allegation, the remaining offenses were serious enough to result in lengthy imprisonment.
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