Key facts
- Delio CEO Jeong Sang-ho received a 15-year prison sentence.
- The conviction is for fraud and using false documents for virtual asset provider registration.
- Key evidence was deemed unlawfully obtained, invalidating the main fraud charge.
- The conviction covers approximately 1,100 victims and 70 billion won ($49 million).
- Delio marketed itself as a crypto bank, offering high interest on deposits.
A South Korean court has sentenced Jeong Sang-ho, the chief executive of crypto lender Delio, to 15 years in prison for fraud and for misrepresenting the company's assets to register as a virtual asset provider. The Seoul Southern District Court found that crucial evidence, including data from Delio's server host, was obtained unlawfully, leading to the dismissal of the primary charge which involved approximately 2,800 victims and 250 billion won (about $176 million).
Consequently, Jeong was convicted on fallback charges that covered around 1,100 victims and 70 billion won, approximately $49 million. The court also found Jeong guilty of dishonestly obtaining a license by overstating Delio's coin holdings by about 47.6 billion won ($34 million) using a falsified accounting report. Prosecutors had initially sought a longer sentence, but the court cited mitigating factors, including external events contributing to the platform's collapse and Jeong's lack of prior serious convictions.
Delio, which marketed itself as a digital asset bank offering high interest on crypto deposits, halted withdrawals in June 2023 and was declared bankrupt in November 2024. The court stated that Jeong promoted Delio as a crypto bank despite lacking the capacity to operate it and blamed bankruptcy for his inability to return customer assets.