South Korean P2P Lender CEO Accused of Embezzlement for Personal Crypto Purchases

A CEO of a major South Korean peer-to-peer (P2P) lender has been accused of misusing funds intended for a construction project to make personal cryptocurrency investments. According to a local media report, an investor had been backing the project financially since 2018, but suspicions arose when the CEO requested an additional 100 million won (around $69,430) for the project.

Investor’s Trust Betrayed

The investor, who had a prior relationship with the CEO, transferred the funds due to their long-standing trust in the company. However, it was later discovered that the funds were not used for the intended purpose of building a residential building in Incheon, South Korea. Instead, the CEO allegedly used the funds for personal crypto investments.

The investor expressed feelings of “a great sense of betrayal” upon discovering the embezzlement, which damaged the trust between companies. The investor stated, “As a famous domestic P2P site, the promise to customers should be the top priority, but Mr. B [the CEO] has broken it.”

Lack of Explanation and Consequences

Despite the allegations, the CEO and the company have remained silent on the matter, even after reporters visited their office in Gangnam, Seoul seeking answers. The CEO returned the initial investment amount but failed to provide the promised interest. The investor plans to take legal action against the CEO and the P2P lender company.

“It is a serious act of betrayal for an individual to use funds received under the pretext of corporate investment,” said the investor, adding that he plans to “reveal the truth about this clear case of embezzlement and customer deception.”

Regulatory Environment

In early January, South Korean regulators announced plans to ease restrictions on corporate crypto investments. Under the new rules, companies will be able to register real-name accounts on crypto exchanges, a privilege previously reserved for retail investors trading in crypto.

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