Ex-Lawmaker Thae Yong-ho’s Son Ordered to Pay $627,000 in Crypto Fraud Damages

Court finds he used his status as a former lawmaker’s son and police connections to deceive the victim

The eldest son of former lawmaker Thae Yong-ho, who was indicted on charges of swindling a large sum by invoking his family background and police protection ties, has been ordered to pay the victim about $627,000 in damages.

According to the legal community on July 5, the Seoul Central District Court ruled in a damages suit filed by a victim identified only as A that Thae must pay about 867 million won ($627,000), plus delay interest.

The ruling became final on June 24 after Thae did not appeal.

The court set damages at the full amount A handed over, excluding money already returned as purported interest.

A said Thae proposed a stablecoin exchange business in about May 2024 and promised guaranteed interest returns. A then handed over cash and crypto assets worth about 1.1 billion won ($796,000).

But Thae had neither the intent nor the ability to invest the money in an actual crypto business. A realized the money had been stolen only around September 2024, when Thae began facing a full-scale police investigation, and then filed the civil suit.

During the trial, the court found that Thae used his position as the son of a lawmaker who defected from North Korea, as well as his ties to police, as part of the deception.

When A tried to verify the loan arrangement or Thae’s ability to repay, Thae showed a family relations certificate and family photos. He then pressured A by saying, “If this really blows up, I won’t be able to do anything either, and my father will kill me.”

He also built trust by sending text messages including: “We’re all involved in this. Even the police,” “A chief in the security division said he would help if there’s a problem,” and “When my family came to South Korea, the personal protection team was made up of the strongest detectives in the country.”

“The defendant appears to have received police protection as the son of a lawmaker who defected from North Korea, or to have had personal ties with some police officers,” the court said. “He used those circumstances to deceive the plaintiff, and a clear causal link is recognized between the fraudulent conduct and the victim’s losses.”

Separately, Thae was arrested and indicted in May and is standing criminal trial on charges including fraud under South Korea’s Act on the Aggravated Punishment of Specific Economic Crimes. Prosecutors allege he took about 1.4 billion won ($1.01 million) from seven acquaintances, including A, under the pretext of proxy crypto investment.

His father, former lawmaker Thae Yong-ho, apologized during a National Assembly audit in October 2024 as the controversy spread, saying he was “deeply sorry” for causing public concern over his eldest son.

Park Sang-kyung, Hankyung.com reporter highseoul@hankyung.com