A kingpin who worked with North Korean hackers to create and distribute illegal gambling websites in South Korea has been sentenced to prison.
On Thursday, the Seoul Central District Court’s 26th Criminal Division, presided over by Judge Lee Hyun Kyung, sentenced Mr. Kim, 56, to five years in prison and five years of disqualification from public office for violating the National Security Act (meetings, communications, etc.). The court also ordered the forfeiture of approximately 1.247 billion KRW (approximately 846,000 USD).
The court found Kim guilty on all charges and dismissed his claim that the National Intelligence Service had obtained evidence through illegal entrapment.
The court said that soliciting North Korean developers and receiving funds to distribute domestic gambling sites posed a serious threat to national security and the country’s democratic order.
The judges further noted that Kim appeared to have worked with North Korean developers to make easy money from gambling. They said that violations of the National Security Act are serious offenses and that Kim spent a long period developing advanced gambling solutions through professional and organized methods. After distributing these gambling sites, he continued to manage and update them, earning significant profit.
Explaining the rationale behind the sentence, the court emphasized that illegal online gambling causes major harm to society and that Kim had avoided responsibility, withdrawn statements, and shown an uncooperative attitude throughout the trial.
Kim stands accused of contacting hackers from North Korea’s Bureau 313 (formerly the Chosun Computer Center), a division of the Military Industry Department, in October-November 2023. He allegedly commissioned the creation of gambling websites. He communicated with the hackers 1,181 times via Telegram for quality assurance, in violation of the National Security Act’s provisions on unauthorized meetings and communications.
During the same period, Kim allegedly received gambling solution promotional software from another hacker affiliated with the 5th Bureau (Overseas Intelligence Bureau) of North Korea’s Reconnaissance General Bureau, in violation of the National Security Act’s provisions on voluntary support and receipt of funds. He is also charged with distributing 71 related domains to 16 domestic gambling site operators for profit, effectively facilitating illegal gambling operations.
Bureau 313 spearheads North Korea’s information technology strategy, generating foreign currency through illicit software services via its Chinese branch. It also serves as a potential hub for cyber warfare against South Korea. The 5th Bureau oversees North Korea’s international covert operations.
Kim faces additional charges of acquiring 1.28 billion KRW (approximately 869,000 USD) in criminal proceeds from gambling site distribution using borrowed-name accounts between November 2022 and August 2024, in violation of the Act on Regulation and Punishment of Criminal Proceeds Concealment.
Prosecutors estimate that the gambling site distribution network funneled approximately 23.5 billion KRW (approximately 15.9 million USD) through borrowed accounts over a 3-year and 5-month period. They believe that 30% of these illicit funds were likely transferred to North Korean hackers and subsequently to the regime.