Delio CEO Admits Investor Deposits Not ‘Principal Protected’ Amid $181M Collapse
Jeong Sang-ho, CEO of Delio, faced intense scrutiny in the second criminal trial held at the Seoul Southern District Court on June 25, where he said investors’ deposits were not “principal protected.”
The trial revolved around the $180 million embezzlement accusation of the South Korean crypto firm. The accusations revolved around Delio guaranteeing the principal of investors’ deposits. CEO Jeong Sang-ho refuted the claim and maintained that Delio never promised principal protection and followed regulatory guidelines set by the Financial Intelligence Unit (FIU).
Delio initially attracted investments by promising returns of approximately 10% per year on deposits of cryptocurrencies like Bitcoin and Ethereum. In June 2023, the company abruptly halted services without notice, leading to accusations of fraud and embezzlement against Jeong, who allegedly misappropriated around $180 million (250 billion won) worth of virtual assets from approximately 2,800 investors.
During the trial, as reported by local news , creditors (investors) challenged Jeong over their deposits ‘principal guarantee.’
When questioned by the prosecution, Jeong stated, “We have never promised to guarantee the principal.”
He elaborated that Delio registered as a virtual asset business operator in 2021, adhered to FIU guidelines, and reported its status quarterly.
“Delio received a grant as a virtual asset business operator in 2021,” Jeong said. “Since then, it has reported the status four times a year and has been managed and supervised by the FIU, so the product was launched and serviced in accordance with the authorities’ guide.”
Creditors quickly responded, questioning, “Why are deposits and staking considered investments?”
The prosecution also
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