Court Jails Crypto Exchange Operator Who Took BTC to Spy for North Korea

A South Korean crypto exchange operator has been sentenced to four years in prison after a court found them guilty of “leaking military secrets” to North Korean hackers in exchange for Bitcoin (BTC) payments.

Chosun Ilbo reported that a 42-year-old individual surnamed Lee was found guilty of violating the National Security Act.

Lee was also suspended from working in similar roles for a further four years.

Crypto Exchange Operator: Jailed for Four Years

The court heard that Lee was the “operator of a crypto exchange” when they “received 700 million won [$480,000]” worth of BTC.

The coins, the court heard, came “from a person believed to be a North Korean hacker.”

Seoul Central District Court. (Source: KBS News/YouTube/Screenshot)

The hacker convinced Lee to “approach an active-duty military officer” to “leak military secrets.”

Presiding Judge Choi Kyung-seo, at a branch of the Seoul Central District Court, said that North Korea “has an anti-state nature.”

Choi added that Pyongyang “seeks to overthrow South Korea’s liberal democratic system.” The court explained:

“Lee was in the pursuit of extremely personal and economic gains. But in the process, Lee committed a crime that could have endangered the entirety of South Korea.”

The court heard that Lee approached a military captain surnamed Kim upon instructions from a “North Korean hacker.”

The hacker, codenamed “Boris,” contacted Lee via Telegram in July 2021. Boris was allegedly biding to “recruit active-duty officers who could provide military secrets.”

Prosecutors explained that Boris was “a member of” 110th Research Center, a Pyongyang-based, state-run hacking group.

The US Treasury placed the group under sanctions in May 2023. Seoul thinks the group was behind 2009 DDoS attacks on “key government agencies” such as the Presidential offices and the National Assembly.

Hackers Paid in Bitcoin

The court heard that Lee gave Kim “a watch-shaped hidden camera” to “film various confidential military documents.”

Lee also “attempted to” aid North Korean hackers by smuggling hacking software into a South Korean military base on a USB flash drive.

However, prosecutors said that law enforcement agencies intercepted Lee before they could hand the USB device over to Kim.

The prosecution service said it had traced the “source of the Bitcoin” Lee received “as compensation for his activities” to help it “conclude that Boris was a “North Korean agent” and a member of the 110th Research Center.

Last year, a court jailed a group of loan sharks who took military passwords as collateral from soldiers . The soldiers wanted to borrow money to invest in crypto.