U.S. District Judge Andrea R. Wood sentenced Joseph Kim of Phoenix, Arizona, to 15 months in prison for fraud involving cryptocurrency transactions.
Kim faced charges in early 2018, when federal prosecutors filed the first criminal case involving the cryptocurrency trading industry, while Kim was charged with a massive fraud in May.
Kim received a 15-month prison sentence for embezzling $1.1 million worth of Bitcoin and Litecoin from two different private cryptocurrency companies.
As the Department of Justice press release stated: “Over a two-month period in 2017, Joseph Kim, 24, of Phoenix, Arizona, embezzled at least $600,000 worth of Bitcoin and Litecoin for his personal benefit.”
This happened while Kim was working as a sales assistant at Consolidated Trading LLC, which subsequently fired him.
Additionally, Kim transferred significant amounts of Consolidated’s Bitcoin and Litecoin crypto funds to his personal accounts as a measure intended to cover losses incurred during cryptocurrency trading on a foreign exchange.
As a cover-up tactic, Kim lied to the company both the trading of the company's so-called cryptocurrency and the company's location.
Kim went to another trading group, where he participated in another crypto scam scheme, in which he ended up losing $545,000 while acting as a “crypto trader” for five different investors.
Of the five people Kim defrauded, four testified in court about their losses on Friday, before U.S. Andrea R. Wood.
“It is important for the public to know that despite the complexity of cryptocurrency trading, the criminal justice system will hold traders and investment professionals accountable for fraud and theft,” said Attorneys Sunil Harjani and Sheri Mecklenburg.
