A South Korean lawmaker has been sentenced to six months in prison for failing to disclose over 9.9 billion won, equivalent to $6.8 million in crypto assets.
According to a local source, Kim Nam-kuk, the convicted Congressman, was found guilty of violating South Korea’s Public Official Ethics Act. This act mandates the disclosure of all significant assets, including crypto holdings.
Kim Converts Cash to Crypto
The prosecutors noted that Kim deliberately concealed his crypto portfolio by transferring assets across bank accounts to conceal significant profits from crypto investments. This reportedly occurred during his property declarations in 2021 and 2022, while he converted the remaining funds back into crypto to align with his declared total assets.
This case has gained significant attention due to the ongoing debate over digital asset taxation and regulatory policies in South Korea. Prosecutors also argued that this scheme enabled Kim to avoid thorough examination by the National Assembly Ethics Committee, concealing the substantial profits he earned from crypto investments.
By altering his financial disclosures, Kim obstructed the committee’s ability to assess his assets accurately, an offense that carries serious legal repercussions in South Korea.
South Korea’s Crypto Implementation
Kim’s actions unfold amid the Democratic Party’s ongoing discussions on virtual asset taxation policies. He has openly criticized the party’s efforts to impose stricter crypto tax regulations, dismissing them as ineffective attempts to gain public support.
However, the Democratic Party has proposed to amend tax laws, raising the tax deduction limit for virtual assets to 50 million won (over $37,000).
A November report revealed that the country’s ruling Democratic Party of Korea (DPK) has finalized plans to implement a long-awaited crypto tax in January 2025. Initially scheduled for 2022, the country’s 20% tax (22% including local taxes) was postponed following resistance from investors, but modifications to address these concerns are provided.
Significant changes involve increasing the tax exemption limit from 2.5 million won ($1,795) to 50 million won (approximately $35,500) in annual profits, significantly decreasing the number of investors impacted.
Meanwhile, the lawmaker’s six-month sentencing comes as a Chinese official received a life prison sentence for selling sensitive and classified state secrets to an unauthorized third party for crypto. Ministry of State Security agents uncovered the official’s activities, revealing he had received over $140,000 via crypto transactions involving Monera tokens.
