A cryptocurrency exchange executive has been sentenced to prison for the second time on espionage charges after allegedly receiving approximately 700 million KRW (about 506,000 USD) worth of Bitcoin and other digital assets from a North Korean operative.
On the morning of Wednesday, the Criminal Division 4-1 of the Seoul High Court, presided over by Chief Judge Ji Young-nan along with Judges Kwon Hyuk-jung and Hwang Jin-goo, upheld the lower court’s ruling. The court maintained the four-year prison sentence for the defendant, identified as Mr. A (42), dismissing appeals from both the defendant and the prosecutor concerning violations of the National Security Act in South Korea.
Mr. A is accused of collaborating with a North Korean operative to recruit an active-duty service member and attempting to breach the Korean Joint Command and Control System (KJCCS), a classified military network. When this attempt failed, he allegedly resorted to using a burner phone to photograph and leak sensitive military information.
During the trial, Mr. A expressed uncertainty as to whether his contact, known as Boris, was indeed a North Korean agent. He maintained that even if Boris were a North Korean operative, he was unaware of it. Mr. A also argued that providing materials for a watch-like recording device or hacking equipment did not constitute aiding and abetting under the National Security Act.
Although the appellate court dismissed one report that the lower court had previously regarded as significant, it concluded that other evidence sufficiently established beyond a reasonable doubt that Boris was a North Korean agent.
The court further determined that Mr. A should have at least suspected Boris’s North Korean affiliation when contacting Captain B, an active-duty officer.
Regarding the acquisition of watch-like recording devices and components for hacking equipment, the court ruled that Mr. A was fully aware of their intended use, thereby constituting a violation of the National Security Act.
The judges condemned Mr. A for endangering national security for personal financial gain and for showing no remorse, even though he acknowledged that his actions were wrong while continuing to deny that they amounted to espionage under the law.
The court explained that the original sentence was appropriate in light of all sentencing factors.
Intelligence reports indicate that Mr. A first encountered the North Korean operative in a cryptocurrency forum over nine years ago. After being recruited, he allegedly received about 700 million KRW (about 506,000 USD) in various cryptocurrencies through two transactions between February and April 2021.
In July 2021, Mr. A was instructed to recruit an active-duty officer to gather military intelligence. He subsequently contacted two officers via Telegram, offering cryptocurrency payments in exchange for classified information. Although one officer declined, Mr. A successfully engaged Captain B through a mutual acquaintance.
Captain B, who also allegedly received approximately 48 million KRW (about 35,000 USD) in cryptocurrency from a North Korean agent and leaked military secrets, has been arrested and charged with violating the National Security Act.