South Korean Lawmaker Kim Nam-kook Sentenced to Prison for Concealing $7.5M in Cryptocurrency, Sparking Calls for Stricter Regulation

A South Korean congressman has been sentenced to six months in prison for concealing his crypto holdings. Former Democratic Party lawmaker Kim Nam-kook hid assets worth 9.9 billion won ($6.8 million) and 990 million won ($680,000) between 2021 and 2022.

A South Korean lawmaker has been sentenced to six months in prison for concealing his cryptocurrency holdings, highlighting the lack of transparency in the country's handling of digital assets and sparking calls for stricter regulation.

Former Democratic Party lawmaker Kim Nam-kook was found guilty of hiding assets worth 9.9 billion won ($6.8 million) and 990 million won ($680,000) between 2021 and 2022, in violation of a law that bars public officials from holding any property without declaring it to the public.

The case attracted attention due to the increasing prevalence of celebrities owning cryptocurrencies and the government's efforts to regulate digital assets.

During the final session on December 18, the prosecution sought a six-month imprisonment of Kim in the hearing held at the Seoul Southern District Court before the presiding Judge Jeong Woo-yong. The prosecution alleged that Kim intentionally concealed his cryptocurrency assets from the Financial Supervisory Commission (FSC) and provided false information regarding his wealth to the National Assembly Ethics Committee.

The prosecution highlighted that Kim exchanged some of his cryptocurrencies to a bank account in an attempt to conceal the large gains he made in the crypto investments. According to the prosecution, he understated the value of his assets in the 2021 and 2022 returns. In 2021, he declared merely 1.2 billion won of assets, but he actively concealed approximately 9.9 billion won in cryptocurrencies. In the same way, he camouflaged 990 million won of cryptocurrency in 2022 through his property report forgery.

The court stated that public officials must declare their assets to prevent corruption and maintain public trust, and that the public is regarded as the victim in this case, as Kim's actions deprived them of the right to know about his assets and hold him accountable. The court's decision also aims to deter other officials from making false asset declarations.

As government struggles to keep up with the rise of cryptocurrency and other new financial instruments, this case may lead to calls for tighter regulation of cryptocurrencies to ensure greater accountability and transparency in the handling of digital assets by public officials.