South Korea witnessed a sharp increase in the number of crypto-related crimes reported by local service providers in 2023, according to a report by the Financial Intelligence Unit (FIU) released on Wednesday.
The report revealed that 16,076 cases of suspicious crypto transactions were reported last year, a 48.8% jump from 2022. The FIU attributed the rise to more active cooperation from the industry to prevent illegal activities involving cryptocurrencies.
The FIU also said that it referred 90% more cases of suspected crypto crimes to law enforcement agencies for further investigation in 2023 than in 2022.
Before prosecutors examine them, the FIU will freeze suspicious virtual asset transactions with a new system that it is planning to introduce. The report stated that the FIU aims to finish the preliminary research for implementing the system by March this year.
To combat crypto crimes such as money laundering, market manipulation, and illegal drug trades, the FIU has developed a new system. The new system will enable the FIU to track, analyze, and report suspicious transactions involving cryptocurrencies.
Crypto Criminals Face Harsh Penalties
In addition, the Korea Customs Office announced today that about 88% of the illegal foreign exchange transactions detected in 2023 involved virtual assets. Some of these transactions used crypto to hide the settlement of funds and evade taxes, according to the local news agency Yonhap.
Furthermore, the customs office has recently established a new team to deal with cryptocurrency crimes, Yonhap reported.
The FIU’s report came a week after the Financial Services Commission (FSC), the country’s top financial regulator, issued a stern warning to crypto criminals.
The FSC said that those who engage in illicit market practices using cryptocurrencies could face severe criminal penalties, including life imprisonment, under the country’s new law for the protection of crypto investors, which will take effect on July 19.
The new law aims to regulate the digital industry and safeguard the rights and interests of investors. It requires crypto service providers to register with the FIU and comply with anti-money laundering and consumer protection rules.
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