Marking the first prosecution in Chicago of theft in the cryptocurrency industry, a trader with a financial firm was charged with fraud. Joseph Kim allegedly misappropriated $2 million in bitcoin and litecoin, the United States Department of Justice said in a press release.

Kim had worked for Consolidated Trading LLC, which recently formed a cryptocurrency group. Over two months in the fall of 2017, Kim allegedly misappropriated at least $2 million of the firm’s digital currency for his own benefit. In addition, he allegedly made false statements to his company to cover up the theft.

To cover his trading losses on foreign exchanges, Kim transferred $2 million in bitcoin and litecoin to his own personal accounts. He allegedly gave false explanations to his company to explain the transfers, but the firm discovered the misappropriation in late November.

The Department of Justice said the punishment for financial crime is high. “Wire fraud is punishable by up to 20 years in prison,” the department said in the release. “If convicted, the court must impose a reasonable sentence under federal statutes and the advisory U.S. sentencing guidelines.”

The news comes after a massive hack at a Japanese cryptocurrency exchange through which $400 million worth of NEM coins have gone missing. Coincheck Inc. said that 500 million NEM tokens were sent “illicitly” out of the exchange. As a result, the exchange halted withdrawals, non-bitcoin trades and deposits into NEM coins at the time of its announcement.

Coincheck’s announcement brought back memories of Mt. Gox, the now-defunct bitcoin exchange that shuttered in Feb. 2014 after a mysterious “glitch” caused $500 million worth of bitcoin to go missing. Those bitcoin — or at least most of them — have remained missing ever since. As for the exchange itself, it eventually went bankrupt.

A congressional hearing was set to explore how the Commodity Futures Trading Commission (CFTC) and the U.S. Securities and Exchange Commission (SEC) could protect investors from the volatility associated with the virtual currency and from fraud in the largely unregulated market.

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