South Korean watchdogs are reportedly opening inquiries into ‘abnormal’ forex transactions worth $3.1 billion linked to crypto investments suspected of money laundering.
According to the Financial Times, the transactions took place in two of the biggest commercial banks in the country: Woori Bank and Shinhan Bank. The Financial Supervisory Service said that such moves worth 4.1 trillion Korean won have been made since February 2021 and involved crypto exchanges and a domestic trading company.
“We’ll take stern measures against the banks that have not abided by forex rules or those who have violated regulations against money laundering,” the FSS commented.
All Korean banks have been asked by the FSS to conduct an internal review of all large currency transactions made between January 2021 and June 2022 for possible similar transactions by the end of this month, after being informed of the irregular deals in June.
Global authorities are increasingly scrutinizing ties between traditional financial companies and the crypto industry and stepping up enforcement activity in the digital asset sector in response to the probe. The tax office and prosecutors will be informed of any other abnormal transactions found from the review.
Investigation of Forex Records
Additionally, the FSS launched an investigation of the forex records of local banks following suspicious activities reported in one branch of Woori Bank. Such activities accounted for 800 billion won or $616 million in the branch located in Seoul in 2021. A single bank branch conducted more than 145 times the average amount of foreign exchange trading, which raised suspicion.
The bank reported the suspicious trading records to the financial authority following an internal audit. As soon as the FSS received the report, it conducted an on-site investigation at the branch.
