Delio Plans to Sue South Korean Watchdogs
Delio, a Bitcoin lending firm based in South Korea, is preparing to file an administrative lawsuit against local financial regulators. The company claims that the regulators have misinterpreted and misapplied the law.
Sanctions Imposed on Delio
The Financial Intelligence Unit (FIU) of South Korea recently recommended the dismissal of Delio CEO Jeong Sang-ho and imposed a 3-month business suspension and a fine of 1.896 billion Won. These sanctions were based on Delio’s alleged failure to assess money laundering risks for its products and services.
Basis for the Lawsuit
Delio argues that the allegations of embezzlement and fraud made by the Financial Service Committee are baseless. The company claims that there were no explicit rules regarding virtual asset deposit and management products, and the regulators unfairly applied the law.
Criticism from Legal Experts
Legal experts in South Korea have raised concerns about the classification of virtual asset-related deposit management products as financial products. They argue that these products do not involve a risk of principal loss and should not be considered financial investment products.
Scrutiny of FIU’s Accusations
The FIU’s accusation that Delio violated its obligation to prohibit transactions with undeclared virtual asset business operators is also being questioned by experts.
Hot Take: South Korea’s Crypto Regulation
South Korea has been increasing its regulation of the cryptocurrency industry, particularly after last year’s Do Kwon scandal. The country has established an interagency investigation team to address issues in the crypto sector.
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