V Global, a South Korean crypto exchange valued at roughly 2 trillion won (about $1.5 billion USD), has been subjected to a government investigation, with six of its executives facing arrest and imprisonment from cases filed by the South Korean government's regulatory authorities. According to initial reports from the The Economist, V Global's execs allegedly enthused investors with the promise of 300% in APY or returns. This promise was coupled with huge referral bonuses for bringing in other investors into what is now being revealed as large-scale fraud network. South Korean regulators, who have been clamping down on crypto exchanges for some time now, declared that V Global had misused its customers' funds. South Korea's Financial Supervisory Service (FSS), the country's integrated financial regulator, has warned investors to be wary of any suspicious investment proposals in the future, especially those promising abnormally high rewards. The South Korean government's arrest of V Global's executives did not result into imprisonment for all of them, however. Of the six, three were not detained after claiming innocence and are still open to appeal for their charges while under a five-year probation. The other three have received prison sentences of between three years up to a maximum of eight years. The fraudulent crypto exchange, which at the height of its operations between July 2020 to April 2021, attracted roughly 50,000 investors by promising them immense returns of up to 300% APY on investments. “The defendants only trusted the VGlobal management team, evaded responsibility, and once the investigation began, they destroyed evidence and interfered with the investigation,” the judge of the 12th Criminal Division of the Suwon District Court stated. According to Korean media reports, however, the judge gave some degree of leniency to the defendants, given that further investigations revealed the scale of the fraud operation to be much less than previous estimates. These executives now join the firm's former CEO aliased as "Mr. Lee" who is now serving a 22-year prison term after being sentenced in February 2022.Earlier reports from Korean media outfit Kyeongin detail how roughly 10,000 investors from the exchange were actually able to see significant returns. These were, however, only made from the multilevel marketing schemes for recruiting other investors into the network. In June of 2022, the firm paid out "referral bonuses" worth $1,000 to each of its clients, suggesting that its operation indeed mirrored that of a Ponzi scheme. Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.