South Korean Regulator Extends AML Rules Adoption until the End of the Year

South Korea’s Financial Services Commission (FSC) has decided to extend the deadline for implementing the Anti-Money Laundering (AML) Anti-Money Laundering (AML) Anti-money laundering (AML) is a term that describes laws, processes, and regulations that are intended to prevent illegally obtained funds from being disguised as income gained through legitimate means. The fundamental purpose of the AML laws is to help safeguard, detect, and report suspicious activity including the predicate offenses to money laundering and terrorist financing, such as securities fraud and market manipulation.Most exchanges have AML measures that include identity verification Anti-money laundering (AML) is a term that describes laws, processes, and regulations that are intended to prevent illegally obtained funds from being disguised as income gained through legitimate means. The fundamental purpose of the AML laws is to help safeguard, detect, and report suspicious activity including the predicate offenses to money laundering and terrorist financing, such as securities fraud and market manipulation.Most exchanges have AML measures that include identity verification Read this Term) protocols in cryptocurrency exchanges until the end of 2021. Originally, crypto trading platforms were given until early July to establish these new AML rulings after the legislation was enacted on March 25, 2021.

However, the regulator granted a six-month grace period, instead of the original deadline, giving the crypto firms time to arrange banking deals to comply with the new set of rules. According to Yonhap, the FSC decided to extend the period until December 31, 2021, as not many exchanges are ready to be audited by banks and the South Korean regulators.

In fact, just twenty exchanges received the information security management system (ISMS) certification last week, and ten are expected to obtain it soon. The FSC argued that it seeks to prevent customers from suffering any collateral damages due to closures of crypto companies that do not meet the requirements on time.

“Since virtual currency transactions are mainly conducted through financial companies, we have extended the guidelines to prevent Money Laundering Money Laundering Money laundering is a blanket term to describe the process by which criminals disguise the original ownership and proceeds of criminal conduct by making such proceeds appear to be derived from a legitimate source.Money laundering is an issue that traverses countless industries and sectors, which includes the financial services space. Though criminal money may be successfully laundered without the assistance of the financial sector, billions of dollars’ worth of criminally derived money are laund Money laundering is a blanket term to describe the process by which criminals disguise the original ownership and proceeds of criminal conduct by making such proceeds appear to be derived from a legitimate source.Money laundering is an issue that traverses countless industries and sectors, which includes the financial services space. Though criminal money may be successfully laundered without the assistance of the financial sector, billions of dollars’ worth of criminally derived money are laund Read this Term issues effectively,” the FSC added, meaning to the recent rulings included in the guidelines, asking banks to classify crypto exchanges’ customers as 'high risk' ones.

Three Months to Review Compliance Checking

Furthermore, the South Korean financial regulator expects to complete the reporting process by the end of the year because it takes around three months to check if exchanges complied with the guidelines accordingly. “We will strengthen monitoring of collection accounts of virtual asset operators that do not use real-name verification deposit and withdrawal accounts,” an officer from the FSC commented.

In terms of crypto taxes, the government has determined to move forward with a 20 percent crypto tax on capital gains from such transactions starting next year, despite recent political turmoil, as the presidential elections will occur in 2022.