Prosecutors in South Korea have launched an investigation into Bithumb, one of the country's largest cryptocurrency exchanges, over claims that company funds were improperly used to assist a former executive in purchasing an apartment.

Officials from the Seoul Southern District Prosecutors’ Office raided Bithumb’s headquarters in Yeoksam-dong and other locations on Wednesday., according to local media report.

Wu Blockchain reported that some projects had paid up to $10 million in fees to list their tokens on Upbit and Bithumb.

The probe focuses on allegations that Bithumb provided a 3 billion KRW ($2 million) security deposit for an apartment rental in Seongsu-dong, Seoul, for Kim Dae-sik, the company’s former CEO and current advisor.

The Financial Supervisory Service, South Korea’s financial regulator, initially reviewed the case before forwarding it to prosecutors. Speaking to The Chosun Daily , a Bithumb spokesperson reportedly acknowledged some of the allegations were correct, adding Kim repaid the loaned amount in its entire after securing a loan.

Bithumb has faced multiple legal challenges in recent years, including tax probes and a raid related to a price manipulation probe . Its latest challenge comes as the firm was reported to be considering listing shares on the Nasdaq .

Bithumb was not immediately available for comment when contacted by CoinDesk.

Disclaimer: Information gathered for this article was translated with the use of artificial intelligence. UPDATE (March 20, 12:33 UTC): Adds additional details and background.