Korea to Inspect 3 Banks Over Crypto Exchange Connections

Three South Korean banks are to be inspected over their compliance with new anti-money laundering rules for cryptocurrency exchange accounts.

Apr 9, 2018 at 8:10 a.m. UTC
Updated Sep 13, 2021 at 7:47 a.m. UTC

South Korean financial regulators are to inspect three domestic banks over their compliance with recently introduced anti-money laundering rules for cryptocurrency exchange accounts.

According to a statement on Monday, the Financial Services Commission (FSC) and the Financial Intelligence Unit (FIU) will conduct on-site inspections on the NongHyup, KB Kookmin and KEB Hana banks from April 19 to 25.

Early this year, the FSC prohibited domestic banks from offering virtual, anonymous accounts to cryptocurrency exchange customers from February in a bid to prevent money laundering and illegal capital outflow via cryptocurrencies.

Since then, at least six banks – NongHyup, KookMin, Shinhan, KEB Hana, IBK, and JB – have been developing their implementations of the new procedures, three of which will be inspected later this month.

Notably, among those institutions up for review, NongHyup Bank has been providing the real-name verification process for two major cryptocurrency exchanges in South Korea, Coinone and Bithumb.

The focus of the inspection will be whether the banks have fully complied with the new real-name verification rules for cryptocurrency exchanges in South Korea, including the number of accounts held by these exchanges and the respective amount of deposits, the regulators said in the announcement.

The plan follows a previous on-site inspection conducted by the financial watchdogs in January and also confirms a previous report on March 22 hinting that regulators may soon launch a second probe this month.

In addition, the FIU also urged other financial institutions not included in the inspection this time to conduct their own checks in an effort to comply with the new anti-money laundering and real-name verification guidelines.

Korean won image via Shutterstock

The Festival for the Decentralized World
Thursday - Sunday, June 9-12, 2022
Austin, Texas
Save a Seat Now

DISCLOSURE

Please note that our privacy policy, terms of use, cookies, and do not sell my personal information has been updated.

The leader in news and information on cryptocurrency, digital assets and the future of money, CoinDesk is a media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. CoinDesk is an independent operating subsidiary of Digital Currency Group, which invests in cryptocurrencies and blockchain startups. As part of their compensation, certain CoinDesk employees, including editorial employees, may receive exposure to DCG equity in the form of stock appreciation rights, which vest over a multi-year period. CoinDesk journalists are not allowed to purchase stock outright in DCG.

Trending

1
CoinDesk - Unknown
Crypto’s Credibility Problem – and How to Solve It

CoinDesk - Unknown
2
CoinDesk - Unknown
First Mover Americas: Bitcoin Heads for Record 8-Week Losing Streak

The latest moves in crypto markets in context for May 20, 2022.

The latest moves in crypto markets in context for May 20, 2022.

CoinDesk - Unknown
3
CoinDesk - Unknown
The Fall of Terra: A Timeline of the Meteoric Rise and Crash of UST and LUNA

A detailed timeline of Terra's journey from its underdog start as a payments app in South Korea to a $60 billion crypto ecosystem to one of the biggest failures in crypto.

A detailed timeline of Terra's journey from its underdog start as a payments app in South Korea to a $60 billion crypto ecosystem to one of the biggest failures in crypto.

CoinDesk - Unknown
4
CoinDesk - Unknown
The Future of Blockchain Technology: Building It Decentralized, Secure and Efficient

The core challenges facing the crypto community as they strive toward mass adoption.

The core challenges facing the crypto community as they strive toward mass adoption.

CoinDesk - Unknown