A bill introduced in South Korea’s National Assembly on August 20 would allow anyone to report suspected violations of the country’s anti-money laundering law directly to the head of its Financial Intelligence Unit (FIU) and give the unit power to refer cases to investigators themselves.
The proposal, numbered 2220655 and sponsored by Representative Eom Tae-young and colleagues, would add a new Article 15-4. It was introduced during the 438th session of the National Assembly.
Bill Targets “Private Coin Exchange Offices”
Current law imposes reporting and anti-money laundering (AML) obligations on virtual asset service providers, but the Financial Intelligence Unit finds it difficult to exercise direct enforcement authority against unregistered operators, according to the bill’s statement of reasons. It refers to these as private coin exchange offices.
The statement says unregistered providers carry a risk of being exploited for money laundering, illegal currency exchange, and illegal overseas remittance, and that a rapid response is difficult because the existing structure depends on cooperation between agencies and on requests for investigation.
Under the proposal, the FIU Commissioner could take necessary measures, including investigation and analysis, and could file a complaint or request an investigation with the competent investigative agency where a violation is recognized.
Korea’s Financial Intelligence Unit sits within the Financial Services Commission and administers the registration regime that virtual asset service providers must enter before operating.
Bill Is a Proposal, Not Law
The measure is a member’s bill and has not been enacted. It must clear committee review and a plenary vote before taking effect, and its text may change. Bills introduced by individual legislators frequently lapse at the end of an Assembly term.
Registration Regime Has Been Tightening
South Korea removed the 1 million won threshold for its crypto travel rule this month, requiring registered providers to exchange transaction information for transfers of any value, with the Cabinet approving the amendments on August 11. The Crypto Times covered the change.
The registration requirement was also the threshold at issue this week when BitGo’s Korean entity received VASP registration acceptance from FIU.
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