South Korea probes US$3.4b of crypto-linked FX transactions

SOUTH Korea's Financial Supervisory Service (FSS) is probing US$3.4 billion worth of "abnormal" foreign-exchange transactions at 2 of the country's largest commercial banks for possible links to illegal crypto-related activities.

Unusual transactions totalling 1.6 trillion won (S$2.2 billion) took place at 5 branches of Woori Bank between May 3, 2021 and Jun 9, 2022, the regulator said in a statement on Wednesday (Jul 27). Similar transactions worth 2.5 trillion won were detected at 11 branches of Shinhan Bank between Feb 23, 2021 and Jul 4, 2022, it said.

Yonhap reported last week that the 2 banks were involved in unusual transactions worth 1.8 trillion won. Financial regulators have been looking into whether the transactions had links to money laundering or currency speculation using crypto assets. Some of the transactions involved crypto exchanges, a senior FSS official said last week.

The FSS on Jul 1 required all banks to conduct an internal review on all sizable overseas transfers as well as any suspicious transactions related to cryptocurrencies that occurred in 2021 and the first half of this year, the statement said. The banks will need to submit a report by end of July.

The information will be shared with the nation's tax office and the prosecutors office, the FSS said. BLOOMBERG


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