South Korea identifies participants in illegal cryptocurrency transactions worth $1.48 billion

The Korea Customs Service of South Korea, in two months, identified 33 individuals who carried out illegal cross-border transactions related to cryptocurrencies amounting to more than 1.69 trillion won ($1.48 billion). The Korea Times reports.

Legal proceedings have been initiated against 14 of them; 15 violators were fined, and four are still under investigation. All were identified as part of a nationwide campaign to investigate offenses related to digital assets, including fraud and money laundering.

Of the aforementioned amount, 812.2 billion won involved illegal foreign currency exchanges, where senders paid a third party to transfer large sums withdrawn from cryptocurrency exchanges.

Approximately 785.1 billion won were involved in transactions by individuals who falsified their reports on cross-border remittances to buy cryptocurrency there. For the same purposes, more than 94.5 billion won were used, withdrawn abroad on cards issued by banks in Korea.

According to the report, in one case, the owner of a currency exchange business, in 17,000 payments, transferred or delivered cash totaling 300 billion won to a foreign client who withdrew funds from an exchange and sought to avoid regulators’ attention.

The businessman earned about 5 billion won in addition to exchange commissions. He and three of his assistants have been charged with violations of the Foreign Exchange Transactions Act.

In another case, the owner of a trading company was fined 12 billion won. He earned 10 billion won from Bitcoin trading, using 355 billion won withdrawn abroad under fake invoices and receipts from a firm registered there. He moved the funds over three years in 563 transactions.

A student at a university was fined 1.6 billion won. His income from Bitcoin trading amounted to 2 billion won. For trading, he used 40 billion won sent abroad to several accounts. The young man falsified reports of money transfers, stating that the funds were intended to pay for study and living abroad.

One of the violators, aided by a group of assistants, withdrew 32 billion won from a foreign credit card for cryptocurrency trading. The proceeds amounted to 1.5 billion won, and the fine was 1.3 billion won.

“Transfers of virtual assets under the guise of trading expenses, travel, or study are strictly prohibited. Violators will be subjected to criminal prosecution or fines,” the Customs Service said.

In April 2021, Korea regulators tightened controls over illicit transactions in digital assets amid a bull market in cryptocurrencies.

In June, the country’s tax residents were required to report their assets on overseas Bitcoin exchanges.