South Korean Crypto Exchange Operator Sentenced for Leaking Military Documents to North Korean Hackers for 14 BTC

South Korean Man Convicted for Leaking Military Secrets to North Korean Hackers

A 42-year-old South Korean man, identified only as Lee, has been sentenced to four years in prison for leaking military secrets to North Korean hackers in return for Bitcoin payments.

The court found Lee guilty of violating the National Security Act, a serious offense in South Korea, especially given the sensitive nature of the information involved.

Bitcoin Payment for Sensitive Information

Lee, who was operating a cryptocurrency exchange at the time, received 14 BTC, worth approximately 700 million won (around $480,000), from a person believed to be a North Korean hacker.

The hacker, identified by the alias "Boris," reportedly persuaded Lee to recruit a military officer to leak classified information through Telegram in July 2021.

The deal raised serious national security concerns, as it involved a breach of South Korea's military integrity.

Link to North Korean Hackers and the 110th Research Center

Boris, believed to be associated with North Korea's 110th Research Center, a state-run hacking group, contacted Lee via Telegram in July 2021.

This group has been linked to several high-profile cyberattacks, including the 2009 DDoS attacks on key South Korean government offices.

Source: Pyongyang Papers

Boris instructed Lee to approach an active-duty military officer, surnamed Kim, to provide confidential military documents in exchange for the Bitcoin reward.

Military Secrets at Stake: Lee’s Role in the Scheme

Lee handed Kim a hidden camera disguised as a watch to “film various confidential military documents.”

Additionally, Lee attempted to smuggle a USB flash drive containing hacking software into a South Korean military base to help the hackers.

Law enforcement intercepted him before the device could be delivered, preventing further damage.

Personal Gain at the Cost of National Security

Presiding Judge Choi Kyung-seo, at the Seoul Central District Court, explained that Lee’s actions were driven by personal financial gain, but at a significant cost to national security.

Judge Choi remarked,

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

Last year, a troubling investigation revealed that South Korean soldiers, driven by economic pressures and financial desperation, turned to cryptocurrency loans, compromising national security by using military passwords and classified information as collateral.

The situation worsened as 29 instances of leaked military secrets were discovered, with soldiers exchanging sensitive documents for crypto loans or to settle debts.

This rise in financial strain, particularly among young people, is exacerbated by disillusionment with traditional economic opportunities, prompting many to engage in risky crypto investments.

South Korean authorities have been tightening their grip on crypto-related activities, particularly when it involves national security threats.

In response to the growing concerns, the government has implemented stricter regulations on cryptocurrency exchanges and transactions, aiming to curb illegal activities.

Additionally, law enforcement has increased surveillance and collaboration with international agencies to prevent further exploitation of digital currencies for illicit purposes.