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Officials in S. Korea seize $47 million worth of crypto

South Korean authorities confiscated more than 50 billion won from individuals accused of evading taxes
South Korea

Authorities in South Korea confiscated more than 50 billion won from individuals accused of evading taxes.

The news was announced earlier today from the Financial Times, which reported that the seized amount was taken from 12,000 tax dodgers. Officials in the province of Gyeonggi claim to have carried out one of the largest tax seizures in South Korea.

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Investigators collected the data and inspected it manually because many exchanges in the country weren’t able to provide any information about their customers. This lack of formal KYC identification has been one of the main reasons for the newest regulatory crackdown.

According to a law passed in 2020, South Korean exchanges must comply with the ID verification procedures and communicate questionable transactions to an anti-money laundering unit called Korea Financial Intelligence Unit (KoFIU). The regulatory action affects nearly 60 platforms operating in the country.

Several crypto exchanges work without the permission of the Financial Services Commission, which is focused on protecting clients against scams and fraud. FSC also aims to get them their money back in case a platform stops operating. Thanks to this new plan, transactions made using unverified accounts will be terminated.

fsc south korea

The commission is taking this measure due to many complaints from crypto exchange users. They don’t feel like the money held by these platforms is protected by authorities. In fact, only four of 60 exchanges have real-name accounts authorized by banks. The unit is requiring financial institutions to file reports if large transactions are made by not identified accounts.

“Banks are essentially forced to take responsibility for issuing real-name accounts. It, therefore, is reasonable that there should be some immunity for undertaking the dangerous and costly task.”

Industry official

The Korea Financial Intelligence Unit (FIU), which is part of the FSC, had a meeting with the directors of Korean crypto exchanges earlier this month. FIU informed them of the new decree that calls them to register with the intelligence unit by September 24, 2021. In order for their registrations to be complete, the virtual platforms must meet certain requirements.

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