South Korea to Fine Crypto Exchanges for Unreported Suspicious Transactions

South Korean crypto exchanges that don't take extensive data collection and identity verification measures could soon be subject to heavy fines. 

March 10, 2021 | AtoZ Markets – The Financial Services Commission of South Korea (FSC) has proposed a new supervisory regulation for Virtual Asset Service Providers (VASP) following the entry into force of the revised Financial Transaction Information Use Act on March 25, 2021.

According to the statement, the proposal introduces a new standard of penalties for VASP, simplifies existing regulations and improves rules for reducing payments to make it easier for small financial enterprises.

South Korea to Fine Crypto Exchanges for Non-Compliance

In accordance with the proposed regulations, VASPs will be subject to fines for non-compliance with the rules for monitoring and registering suspicious transactions.

The regulator offered the possibility of reducing payments by 50%. Small businesses will be able to qualify for a reduction in fines in excess of this limit.

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The proposal will be submitted for public comment from March 11 to April 20, 2021 and will enter into force after the official announcement.

Recall that Korea's largest cryptocurrency exchange Bithumb has imposed restrictions on users from high-rice jurisdictions as part of its anti-money laundering policy.

Previously, Bithumb integrated a solution from the analytical company Chainanylsis to track suspicious transactions.

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