KRW800bn Remitted Overseas through about 400 Transactions
The Financial Supervisory Service is inspecting Woori Bank as one of the bank's branches in Seoul is involved in foreign exchange transactions suspected of money laundering.
According to reports, a total of 800 billion won was remitted overseas through about 400 transactions at the bank's Eunpyeong New Town branch during a period of less than one year from the second half of 2021. In other words, billions of won were sent overseas in the form of trade finance at least once every business day at the branch.
According to reports, the funds were identified as Chinese capital laundered at a Korean virtual asset exchange. A money laundering gang set up a paper company, brought in Chinese capital, traded coins at the exchange, withdrew them to a Korean currency account, transferred them to Woori Bank, and wired them overseas. This process was repeated over 400 times.
A considerable repercussion is expected from the unusual case. “This is the first time that a Korean virtual asset exchange and a bank have been used as channels for money laundering,” a Korean government official said. “It appears that Woori Bank cannot avoid sanctions. The degree of punishment will depend on how faithfully it abided by the suspicious transaction reporting (STR) and currency transaction reporting (CTR) obligations."
The Korean virtual asset exchange where money laundering has taken place may be subject to ex officio cancellation. Regardless of whether it is forced to stop business all or partially, it will not be allowed to use a Korean won bank account in the future.
The FSS is expected to conduct an extensive inspection on the virtual asset exchange and Woori Bank if all sources of the funds in question are identified.