Cryptocurrency South Korea AML 29 Jun 2018
South Korea updates crypto exchanges AML guidelines following the on-site inspections of three local banks - Nonghyup, Kookmin, and Hana Bank. What are the new requirements?
29 June, AtoZ Markets – The key financial regulator of South Korea, the Financial Services Commission (FSC) has reportedly released a set of updated anti-money laundering (AML) guidelines for the cryptocurrency market participants.
The official press release from the South Korean regulator stats that the FSC has carried on-site inspections of three local banks - Nonghyup, Kookmin, and Hana Bank. In fact, the results of these inspections are what led the regulator to the review the AML guidelines.
The new guidelines mention that cryptocurrency exchanges now must conduct Customer Due Diligence (CDD) and Enhanced Customer Identification (EDD). These changes aim to ensure the legitimacy of the trade purposes and funding sources of users.
Following on this, as per the revised guidelines, cryptocurrency exchanges also need to make sure that foreigners are not using the domestic crypto exchange. It is also necessary to make certain that criminals are not utilizing the personal accounts of other people in a bid to launder money. Lastly, the exchanges will need to closely monitor the transactions and payments processing.
Earlier this May, the FCS has joined a cryptocurrency investigation that has been initiated by South Korean Financial Supervisory Service (FSS) into AML compliance of cryptocurrency exchanges.
Just last week, the South Korean Financial Supervisory Service has ordered Samsung Securities to halt some of its operations for a period of six months. The order comes amid an investigation into a massive stock insurance error.
Samsung Securities is the brokerage branch of the South Korean largest conglomerate. The financial supervisor has also urged the organization and other brokerages to solidify their internal controls. The initiative aims to manage the concerns related to the compliance protocols after one of the world’s largest “fat-finger” mistakes.
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