News / South Korea Step Up Against Crypto-Related Money Laundering

South Korea Step Up Against Crypto-Related Money Laundering

South Korea's financial regulator, the Financial Services Commission (FSC), has vowed to take decisive action against crypto-related money laundering.

02 min read

On December 3, 2024, South Korea’s financial regulator plans to crack down on individuals who use cryptocurrency for money laundering.

Chairman of the Financial Services Commission (FSC) “Kim Byung-hwan” revealed in the 18th AML day commemoration ceremony that he observed rising illegal activities that are executed through virtual assets. He also had intended to bring amendments to the foreign exchange regulation to track cross-border transactions of virtual assets.

At a recent ceremony, Kim recognized and honored four organizations — including 28 individuals & Shinhan Savings Bank for their significant contributions to preventing money laundering.

This recognition comes with an emphasis on the struggle of anti-money laundering efforts and the commitments of those individuals and entities who work to combat financial crime.

Kim also discussed the “Kimchi Premium” phenomenon in the South Korean Cryptocurrency market, specifically with Bitcoin. The premium prices attract illegal and legitimate actors because they usually observe the price of Bitcoin as higher on South Korean exchanges. This confused state between legal & illegal activities highlights various challenges for South Korean legal authorities.

Kim also demands a strategic approach to combat illegal activities that harm individuals’ livelihoods and the entire economy.

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The agency also analyzed that traditional monitoring, investigation, and detection methods aren’t sufficient to resolve emerging threats, such as youth gambling & illegal reading rooms. FSC advocates for advanced measures that can prevent crimes from occurring in the first place.

As per media sources, the new processes will block the flow of criminal funds early on by freezing accounts before illicit funds can be transferred. This approach is expected to increase the effectiveness of confiscation measures & reduce criminal or illegal activities.

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