A class action lawsuit has been filed in South Korea accusing cryptocurrency exchange V Global of defrauding investors. The police reportedly estimated that 69,000 people have invested in the crypto exchange and the loss amounted to 3.8 trillion won.
Crypto exchange sued for defrauding investors
South Korean cryptocurrency exchange V Global has been accused of fraud worth $3.8 trillion ($3.5 billion).
A class action lawsuit has been filed by 130 victims. Daegon, a law firm representing the victims, said: “130 victims decided to file a joint complaint with the Gyeonggi Southern Police Agency on June 4 against three officers and employees, including the CEO of cryptocurrency exchange V Global.” According to local media:
Police estimate that 69,000 victims have invested in V Global and 3.8 trillion in damages.
Han Sang-joon, a lawyer for Daegon, explained that “there were actually 20,000 to 30,000 victims who did not get their money back, and 600 billion to 1 trillion won in money that was not returned.” However, he insisted that “it could be bigger.” In April, V Global filed a defamation case against Daegon.
V Global held briefing sessions nationwide from August last year until recently, promising investors that if they open an account with a crypto exchange and deposit at least $6 million in the account, they’ll win $18 million. Will get back three times, invest in less time.”
Victims also said that V Global divided investors into 7 tiers and promised to pay them every time a new member was brought in. Investors soon realized that the crypto exchange operates a Ponzi scheme and that existing members’ investments are returned with new members’ money. V Global has also issued its own local token.
The Gyeonggi Nambu Police Agency suspected illegal activities at V Global earlier this year and launched an investigation. Police are reportedly expanding their investigation across the country as the company held investment briefing sessions and recruited investors from across the country.
Last month, police raided a cryptocurrency exchange and V Global secured 240 billion won. “We have booked about 60 suspects so far, and we are analyzing the items confiscated prior to indictment,” said Nam Gu-jun, head of the National Investigation Headquarters.
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