South Korean Assembly Member Under Fire for Alleged Crypto Insider Trading

South Korean lawmaker Kim Nam-kuk has found himself in hot water after being accused of performing suspicious crypto trades worth about KRW 6 billion ($4.5 million). 

The politician is accused of withdrawing his crypto holdings from an exchange shortly before the country implemented the so-called crypto travel rule in March 2022, The Korea Times reported. The rule obliged owners of crypto assets to carry out real-name transactions. The unnamed exchange reported Kim’s transactions to the state-run Korea Financial Intelligence Unit which subsequently filed the case to South Korean prosecutors. The MP rejects the accusations, and claims that he had not cashed out most of his crypto holdings, but transferred them to a different exchange. 

Politician rejects accusations

Kim is also defending himself by saying that he was not required to report his crypto holdings under the disclosure obligation of the country’s public service ethics act.

“I did not borrow and receive money from anyone at all (for the crypto trading),” the lawmaker declared. “I sold some of my stocks to use for the initial crypto investment. I also made transactions only through real-name accounts and I can transparently share all of the transaction records.

Kim is an MP for the Democratic Party of Korea (DPK), South Korea’s s main opposition party. The DPK is the largest party in the National Assembly, the lower chamber of the country’s parliament, with 168 lawmakers, and it opposes the People Power Party (PPP) of South Korean President Yoon Suk Yeol. 

Ruling party attacks MP

The PPP has blasted the opposition lawmaker as both parties are intensifying their rivalry ahead of South Korea’s forthcoming parliamentary election. The vote is expected to take place in April 2024. 

“The public is shocked by his ambivalent attitude and attempts to gain sympathy by highlighting his cheap shoes, even though he held crypto assets worth 6 billion won,” said Yoo Sang-bum, a lawmaker and spokesperson for the PPP.

The ruling party’s politician was referring to Kim’s efforts to present himself as a modest public servant who seeks to represent the socially vulnerable segments of South Korea’s population. 

Meanwhile, Hong Joon-pyo, who is the mayor of Daegu and a politician of the PPP, has also called on Kim to resign his post.

“This is a serious moral hazard,” the mayor said. “He appeared to have had a get-rich-quick scheme with crypto trading. He should have left his job as a lawmaker and focused on speculative trading instead. On top of that, he stood at the forefront of delaying crypto taxation, which can be seen as an abuse of his legislative power for the protection of his private assets.”