South Korea arrests suspects linked to ‘kimchi premium’ cases

South Korean authorities have arrested 16 people suspected of aiding illegal foreign-exchange operations as part of the ‘kimchi premium’ arbitrage. Seoul Daily News reports.

According to the publication, cryptocurrencies are involved in 75% of offences relating to capital outflows from the country and money laundering.

Two of the arrested face trial, seven face fines, and no decision has yet been made regarding the others.

One of the detainees is suspected of creating several one-day shell companies designed to send funds abroad. The journalists claim that this essentially involves transferring digital assets from overseas accounts and selling them profitably on local exchanges thanks to the ‘kimchi premium’.

Another arrestee is suspected of using import operations to mask cryptocurrency transactions.

In August, the FSS, in the course of investigations of similar violations, estimated the volume of overseas transfers to crypto exchanges in the amount of $6.5 billion.

The authorities first reported in October 2021 about problems associated with the ‘kimchi premium’.

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