Key Points:

  • South Korean congressman Kim Nam-guk held 800,000 WEMIX when he proposed deferring taxation of virtual assets such as cryptocurrencies by 2021.

  • Prosecutors are investigating his cryptocurrency trading fraud allegations.

  • Wemix coins, worth about 6 billion won at the time, entered its virtual wallet in January and February last year.

According to South Korean media reports, South Korean congressman Kim Nam-guk held 800,000 WEMIX when he proposed postponing the tax on virtual assets such as cryptocurrencies by 2021. The peak price exceeds 6 billion won (about $4.55 million).

It has been confirmed that the prosecution is investigating allegations of cryptocurrency trading fraud by Representative Kim Nam-guk (41) of the Democratic Party of Korea.

According to the legal community, on the 6th, the Seoul Southern District Prosecutors’ Office received records regarding Congressman Kim’s cryptocurrency transactions from the Financial Intelligence Unit (FIU) last year and is examining them to check for any illegal activity.

FIU discovered that Congressman Kim withdrew all 800,000 Wemix coins he owned from late February to early March last year. The details of Congressman Kim’s transaction were then classified as unusual and reported to the prosecution.

Congressman Kim placed Wemix coins, worth about 6 billion won at the time, into his virtual wallet in January and February of last year and disposed of them all before March of last year when the ”real name coin system” was implemented. The virtual currency exchange where Congressman Kim’s wallet is registered reported the transaction details to the FIU. The FIU assessed it as unusual, notified the prosecution, and handed over the relevant data.

Kim Nam-guk, who has invested in coins since 2016, jointly proposes a virtual asset tax deferment

Generally, exchanges report to the FIU when funds are traded in large quantities. The FIU then determines if there is an unusual transaction and notifies the investigating agency.

The prosecution requested an order to monitor Congressman Kim’s account based on the FIU’s data, but the court denied it. Even then, the prosecutor’s office has not closed case B and continues the related investigation.

Representative Kim confirmed that it was a normal coin transaction. In a phone call with the media, Representative Kim said, “It was a transaction without any problems, and I was completely unaware (in connection with the investigation by the Southern District Attorney’s Office).”

Concerns were also voiced by the Democratic Party. Representative Lee Yong-woo, who initiated the bill to mandate the reporting of virtual assets, wrote on Facebook that if a state official holds virtual assets, there is a high probability of problems such as illicit gains, concealment of assets, or tax evasion.

DISCLAIMER: The Information on this website is provided as general market commentary and does not constitute investment advice. We encourage you to do your own research before investing.

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