Seoul court sentenced Delio CEO Jeong Sang-ho to 15 years for defrauding 1,100 victims of $49M in crypto, after evidence ruling reduced original $176M case.
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A Seoul court sentenced Delio chief executive Jeong Sang-ho to 15 years in prison Thursday for fraud and falsifying records, after prosecutors failed to prove the full scope of the crypto deposit platform's collapse.
Criminal Division 11 of the Seoul Southern District Court, presided over by Judge Jang Chan, handed down the ruling on Thursday afternoon, according to local outlet Newsis. The sentence was five years short of the 20 years prosecutors had sought.
The reason was procedural. Jeong's lawyers argued that a search and seizure at Gabia, the company hosting Delio's servers, had been unlawful. The court agreed. Prosecutors had not guaranteed Delio's right to participate in the search and had not handed over a list of what was seized, the court found, ruling that the platform's database and everything derived from it carried no evidentiary value.
That gutted the original indictment, which had accused Jeong of defrauding roughly 2,800 people of about 250 billion won, some $176 million, in crypto between August 2021 and June 2023. What survived was the reserve case, covering about 1,100 victims and roughly 70 billion won, or $49 million, which prosecutors had added as insurance after the evidence was challenged. Jeong was acquitted in respect of 41 further victims for whom no evidence was submitted.
He was also convicted of registering Delio as a virtual asset service provider using a falsified accounting firm report. Prosecutors said the report overstated its coin holdings by about 47.6 billion won, roughly $34 million.
"Jeong obtained his license dishonestly and took more than 70 billion won from customers," the court said. He had promoted Delio as a crypto bank while lacking the capacity to run it, the judges added, and had evaded responsibility by blaming bankruptcy for his failure to return customer assets.
In mitigation, the court noted that outside events had contributed to the collapse and that Jeong had no previous convictions carrying a penalty above a fine.
The verdict had originally been due on July 16 but was delayed after Jeong's team raised the evidence issue and the court reopened arguments. Prosecutors then filed the narrower fallback charges in case the server material was excluded, which is what happened.
Delio offered high interest on deposits of Bitcoin and Ethereum, marketing itself as a digital asset bank. It halted withdrawals without warning in June 2023, suspended its service that August after failing to secure court approval for running costs, and was declared bankrupt in November 2024.
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