Korean FIU To Tighten Regulation Of Financial Institutions
The Korean Ministry of Finance
and Economy announced on Sunday that the newly launched Financial Intelligence
Unit (FIU) will be tightening the regulatory procedures surrounding foreign
exchange transactions. From next year, overseas
branches of Korean financial institutions will be required to report foreign
exchange transactions of over $10,000, and Korean currency transactions of over
50 million won to the FIU, which will investigate and pass details of suspected
money laundering practices to the country's law enforcement agencies. According to the Finance
Ministry, the new rules will not apply to financial firms incorporated abroad
by Korean institutions, as they are entirely supervised by the authorities in
the country in which they are incorporated. The Korean government has
estimated that the amount of money laundered through the country's financial
sector could be as much as 148 trillion won, and could account for between 11%
and 33% of annual GDP. Tax evasion is also a problem, and it is believed that
of that total, between 25 and 40 trillion won is siphoned out of the country
through illegal channels. .
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