A South Korean court has sentenced Jeong Sang-ho, chief executive officer of cryptocurrency investment platform Delio, to 15 years in prison in a major digital asset fraud case. The Seoul Southern District Court found Jeong guilty on most charges related to approximately 70 billion Korean won, or around ₹410 crore, in crypto assets belonging to customers. Prosecutors had sought a 20-year prison sentence, but the court imposed a shorter term after acquitting him of one of the principal fraud charges.
According to the court’s ruling, Jeong was primarily convicted of embezzling customer assets and using false documents to register as a virtual asset service provider. The court found that the defendant caused significant financial losses to a large number of victims and considered the method used to commit the offences and the scale of the damage particularly serious.
However, the court acquitted Jeong of the central fraud charge alleging that he had defrauded around 2,800 people of approximately 250 billion Korean won, equivalent to about ₹1,460 crore. According to reports, the court rejected important evidence presented in connection with this charge.
The court ruled that evidence obtained during the search and seizure of a server operator had been collected unlawfully. As a result, prosecutors were unable to rely on that evidence to establish the main fraud allegation beyond the required legal standard. The acquittal significantly reduced the scope of the charges for which Jeong could be held criminally responsible, although he was still convicted on other serious offences.
The court also made strong observations about the seriousness of Jeong’s conduct. It said the defendant had defrauded a large amount of money from numerous victims and that the methods used, together with the scale of the financial damage, made the offences extremely grave. The court further noted that Jeong had failed to obtain forgiveness from victims who suffered substantial economic losses.
Jeong was also ordered to remain in custody. According to a separate report, the court cited the risk of flight as the reason for ordering his detention. The decision represents a significant development in the long-running legal proceedings surrounding Delio and its handling of customer assets.
Delio had promoted itself as a digital asset bank and offered customers attractive returns on cryptocurrency deposits. The platform allowed customers to deposit digital assets with the expectation of receiving returns. However, in June 2023, the company abruptly suspended withdrawals, leaving many customers unable to access their cryptocurrency holdings and raising serious questions about the company’s financial condition and management of customer assets.
Following the suspension of withdrawals, legal and financial action against Delio intensified. The company was subsequently declared bankrupt in November 2024. The bankruptcy proceedings and criminal investigation focused attention on the management of customer assets, the company’s operations and the role played by its executives.
The case is significant as South Korea continues to strengthen oversight of the cryptocurrency and virtual asset industry. The Delio proceedings have highlighted concerns over the safeguards required for platforms that accept customer digital assets while promising high returns.
The case also underlines the importance of lawful evidence collection in major financial crime investigations. Although Jeong was convicted on several serious charges and sentenced to 15 years in prison, the court’s decision to acquit him of the principal fraud allegation demonstrates how procedural violations in evidence gathering can affect even high-value criminal prosecutions.
The verdict is expected to draw further attention to compliance requirements for virtual asset service providers and the protection of customer funds. It also reinforces the growing scrutiny faced by cryptocurrency businesses operating in South Korea, particularly those handling large volumes of customer assets and offering investment or yield-based products.
