The brothers Lee Hee-jin and Hee-moon, indicted on charges of obstructing business by submitting false documents during the process of listing a virtual asset on Upbit, and Upbit are locked in a dispute over whether there was a request to list a coin. Lee Hee-jin claims he asked an Upbit executive to list the coin, but Upbit previously received non-indictment decisions in two probes by police and prosecutors into alleged listing requests.
On the 23rd, according to the virtual asset industry and according to legal sources, A, the chief operating officer (COO; Chief Operating Officer) of Upbit operator Dunamu, appeared last month on the 13th as a prosecution witness at the Lees' trial. Prosecutors charged the brothers in February 2024 with obstruction of business, saying they submitted documents that falsely stated the distribution plan and operators of the PICA coin during the Upbit listing process, hindering Upbit's listing review.
The Lees' attorney argues it does not constitute obstruction because Upbit knew in advance that the PICA coin was connected to the brothers. The evidence cited by the defense is that A and Lee Hee-jin met at a hotel in Seoul and a KakaoTalk message Lee sent to his younger brother saying, "I spoke with President A, and he said he'll relist it on the KRW market."
A and Lee Hee-jin are said to have built a professional acquaintance through a past stock-broadcasting business. Afterward, Lee received a three-year-and-six-month prison sentence for a stock fraud worth about 100 billion won, was released upon completion, and in July 2020 called A to a hotel.
In court, A testified, "I met him (at the hotel) because I was told Lee Hee-jin had turned over a new leaf and because of our past ties," adding, "I did not know whether the brothers were behind the PICA coin, and there was no request to list any specific coin."
In fact, PICA was not listed on Upbit's won (KRW) market. The KakaoTalk messages presented by the defense were reportedly not admitted as evidence by the court because they had not been discussed in advance with prosecutors and their source was unclear.
In 2021, A was investigated by police on suspicion of receiving money in connection with supporting PICA transactions and the case was closed with no charges. In 2023, the Seoul Southern District Prosecutors' Office investigated the five major exchanges over whether they received money in return for listing PICA and other coins, and Dunamu received a non-indictment decision.
In the virtual asset industry, some say Lee Hee-jin is resurfacing a matter previously closed with no charges for another purpose. Lee was sued in May last year on suspicion of failing to settle about 1.88 billion won with the PICA coin developer. An industry official said, "It appears Lee is claiming he paid listing fees (money given in return for listing on an exchange) to Upbit and others in order not to pay the settlement."
Issued in August 2020, the PICA coin was listed on Upbit's Bitcoin (BTC) market in January the following year and was delisted in June that year due to false disclosures about circulation volume. The PICA coin foundation sought an injunction against the delisting decision, but the court dismissed it.
A Dunamu official said, "It appears this trial is being used to obtain testimony favorable to each side in the profit dispute between Lee Hee-jin and the PICA operators," adding, "Given the significant damage to both the company and individuals, we are reviewing legal action in response to Lee's recent claims."
The brothers are set to stand trial on the 24th on charges of obstruction of business and fraud. In October 2023, prosecutors also indicted them on charges of issuing and listing three "scam coins (Scam Coin; fraudulent virtual assets)" including PICA, then stealing a total of 89.7 billion won through false and exaggerated promotion and price rigging.