South Korea to introduce crypto crime investigation unit

As a researcher with a background in finance and a keen interest in the crypto space, I strongly believe that South Korea’s decision to establish a permanent investigative unit for crypto crimes is a crucial step towards enhancing the security and legitimacy of the digital asset market.

South Korean regulatory bodies are taking steps ahead to tackle the increasing number of cryptocurrency-related crimes by proposing the creation of a dedicated investigation team.

As a researcher, I’ve come across some intriguing news. Starting from early May, the Justice Ministry and the Ministry of the Interior and Safety are set to initiate discussions regarding the establishment of the Joint Virtual Asset Crime Investigation Unit as an official department.

The current operation of the unit is on a temporary basis, supervised by the Seoul Southern District Prosecutor’s Office. With the new regulations, its standing will be upgraded through the appointment of new prosecutors and designated funding.

As a crypto investor, I’d put it this way: Last summer, a team of 30 specialists from various financial and tax regulatory bodies came together to form our country’s inaugural unit dedicated exclusively to investigating digital asset-related criminal activities.

Over the past year, South Korea has experienced a noteworthy surge in cryptocurrency-related crimes. According to a report published in February by the Financial Intelligence Unit (FIU), approximately 16,076 suspicious transactions were identified and reported by the watchdog. Compared to the previous year, this represents a sizable jump of 48.8%.

The financial dealings were connected to a variety of unlawful acts, such as money laundering, manipulation of markets, and the sale of prohibited substances.

The significant expansion was largely due to the Financial Intelligence Unit (FIU) actively collaborating with local cryptocurrency providers, encouraging them to disclose any suspicious transactions. This proactive approach resulted in a substantial jump of 90% in the number of crypto-related cases being forwarded for further investigation by law enforcement agencies.

In a recent development, the Haeundae Police Station in Busan, South Korea, apprehended two individuals who orchestrated a fraudulent scheme involving cryptocurrency investments. These con artists managed to swindle an astonishing 5.5 billion won ($4.1 million) from unsuspecting victims by promising them guaranteed returns of 70% for each monthly investment worth 1 billion won.

Starting July 19, South Korea will enforce its initial cryptocurrency regulatory system. This legislation introduces more stringent consequences for those engaging in crypto market manipulation, including potential prison terms reaching as far as life imprisonment depending on the gravity of the offense.

In July 2023, the “Virtual Asset User Protection Act” was first enacted, providing a year’s leeway for implementation. Immediately following its passage, the Joint Virtual Asset Crime Investigation Unit came into being.

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2024-04-29 16:58