Monday, October 22, 2018

New Cryptocurrency Limits in South Korea

Deposits / Withdrawals Over 10K USD Becomes Suspicious

Starting on the 30th of January, South Koreans will be limited to depositing / withdrawing 10 million won a day — anything over that amount will get their transaction labeled as “suspicious.” That amount of Korean won is the equivalent of less than 10,000 U.S. dollars based on current exchange rates.

There is also a weekly limit of 20 million won.

The 30th of this month is when the real-name system for cryptocurrency transactions is expected to be introduced simultaneously by six banks. Other banks that refuse to implement a real-name system for cryptocurrency transactions will not be allowed to open new accounts for cryptocurrency clients.

Because this is breaking news, this page is still undergoing editorial revision.

The bank must immediately report suspicious transactions to the government.

If you want to use password-related accounts in three banks that handle password-protected accounts such as the NACF and Shinhan Bank, you must trade them with your real name. Users who do not have their account at the bank of the Counter Exchange can withdraw but can not deposit. You must open your account at the same bank as the bank of the currency exchange to deposit new funds.
  
A bank may refuse a transaction even if the risk of money laundering is considered to be particularly high, such as if the Counter Exchange does not use the blind deposit / withdrawal account service. Foreigners and minors under the Civil Law are restricted from using the account to verify their blindness. Once the real name system is implemented, the existing virtual account service can no longer be used for password transactions.
  
Regulations on cryptographic transactions have been strengthened, including the introduction of a ‘blind deposit / withdrawal system’.

  
The Financial Services Commission and the Financial Supervisory Service (FSS) announced a “real-name transaction” plan and a “guideline on the prevention of money laundering related to money money” on 23rd. The deposit and withdrawal for cryptographic transactions is effectively limited to less than 10 million won per day and less than 20 million won per week. When they are over, they are classified as types of financial transactions that can be suspected of money laundering. Also, even if the user is a corporation or a group, their deposit and withdrawal transactions correspond to types of financial transactions that can be suspected of money laundering. A bank with a cryptographic account should immediately report to the Financial Intelligence Unit (FIU) if suspicious transactions are found.
  
The bank must fulfill a high level of cautionary obligation, such as ensuring that cryptographic facilities safeguard your transaction funds in the future. In addition, if the cryptographic service provider refuses to provide identification information, the bank must refuse to provide the account service. Banks must strengthen internal control over cryptography. Information about the currency exchange can be shared between banks.
  
The anti-money laundering guideline was based on the bank’s on-site investigation from 8th to 16th. Kim Yong-bum, vice chairman of the Financial Services Commission, said in a briefing on the day, “We have found many weaknesses in implementing the anti-money laundering obligations of banknotes to cryptographic facilities.” A bank issued a virtual account to resell it to a cryptographic facility , And the case of registering and operating the cryptographic money handling business as a “shopping mall”, but the bank did not have a customer verification procedure or internal control device. ”
  
In some cases, the funds deposited in the cryptographic facility were transferred to the major shareholder or employee account of the cryptographic facility or the funds were transferred to the cryptographic facility account in the name of the corporation. The financial authorities have noticed that the bank has not been faithfully reporting on abnormal fund transactions.
  
The Financial Authority expects to prevent illegal activities (money laundering and tax evasion) through cryptography through the use of real-name system and anti-money laundering guidelines, while at the same time effectively eliminating cryptographic facilities with a high risk of abuse in money laundering. However, Kim pointed out that “there is no reason to institutionalize cryptographic facilities or activate transactions through cryptographic facilities”.
  
The bank has asked the FIU to report suspicious transactions to the FIU for unusual fund transactions that were revealed during the test. The FIU will act according to specific financial information laws, including notifying law enforcement agencies such as the prosecution, the police, and the National Tax Service when it is suspected of suspected transaction reports.

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