[Exclusive] Prosecution and Customs Conduct Search and Seizure at Woori and Shinhan Bank Branches over 'Suspicious Foreign Exchange Remittances'

Prosecutors and Customs Focus on Tracking Money Flows
Seem to Have Visited to Secure Additional Materials

[Asia Economy Reporters Seungseop Song, Eunju Lee, Daehyun Kim] On the 29th, the prosecution and customs authorities launched a joint investigation targeting banks embroiled in a foreign exchange remittance controversy involving trillions of won. This comes just one week after the prosecution conducted a search and seizure at the Woori Bank headquarters on the 21st.

According to a comprehensive report by Asia Economy, on the morning of the same day, the International Crime Investigation Division of the Seoul Central District Prosecutors' Office (Chief Prosecutor Nauk Jin) dispatched investigators to branches of Shinhan Bank and Woori Bank to carry out search and seizure operations. Customs authorities also participated alongside prosecution personnel in the on-site investigation. These branches had recently handled foreign exchange abnormal transaction remittances that surfaced in the financial sector. The prosecution is said to have visited the sites to secure additional evidence.

Controversy arose in the financial sector after it was revealed that Korean won exchanged at cryptocurrency exchanges had been transferred overseas through banks. The fund routes of the companies that conducted the remittances appeared suspicious, and some companies seemed to be ghost companies, prompting the Financial Supervisory Service to conduct inspections.

The prosecution is investigating the actual operation of currency arbitrage using the Kimchi premium, the sources of the trillions of won that flowed in, the final destinations and recipients of the money that was transferred out. Investigations into domestic companies that sent money overseas are also underway. Additionally, they are examining whether there was any negligence on the part of the banks during the foreign exchange remittance process and whether internal employees were involved in illegal activities.

In the financial and legal sectors, it is expected that search and seizure operations at the branches will continue for some time to secure evidence. According to the inspection results identified so far by the Financial Supervisory Service, foreign exchange remittance companies are associated with Shinhan Bank (29 companies), Woori Bank (26 companies), KB Kookmin Bank (24 companies), and Hana Bank (19 companies).

On the 21st, the Anti-Corruption Investigation Division of the Daegu District Prosecutors' Office (Chief Prosecutor Ilgyu Lee) conducted a search and seizure at the Woori Bank headquarters in Jung-gu, Seoul. The prosecution is investigating whether a branch manager at Woori Bank knowingly overlooked illegal remittances in advance. They also suspect that a Woori Bank official may have leaked information about the prosecution’s investigation to illegal remittance companies.

Meanwhile, according to the Financial Supervisory Service, the largest amount of abnormal foreign exchange transaction remittances identified so far is at Shinhan Bank, totaling $2.36 billion. Following that are Woori Bank with $1.62 billion, Hana Bank with $1.08 billion, and KB Kookmin Bank with $750 million. The total amount is $7.22 billion, which converts to 10.1729 trillion won.