Announcement of 2024 Business Plan
The Financial Intelligence Unit (FIU) under the Financial Services Commission announced that it will strengthen the review of virtual asset service providers this year. Additionally, regarding anti-money laundering (AML) inspections of financial companies, the focus will shift from punishment to capacity building.
On the 12th, the FIU announced its "2024 Work Plan" through the Policy Advisory Committee and related agency council. The work plan is broadly divided into three parts: △ redefining the direction of AML inspections for financial companies △ strengthening the review of virtual asset service provider registrations △ focusing on crimes involving the misuse of virtual assets and illegal private financing reviews.
According to the work plan, the FIU plans to block attempts by unqualified providers to enter the market by strengthening registration requirements for virtual asset service providers. The core measure is expanding the scope of review targets from current providers and executives to include 'major shareholders.' As part of this, legal and social credit requirements will be added to the review criteria to exclude those with prior violations. Furthermore, institutional improvements such as amendments to the Act on Reporting and Using Specified Financial Transaction Information (the Specified Financial Transaction Act) will be pursued to clarify reasons for registration rejection and strengthen the registration review process.
For providers already in the market who are unqualified, the FIU will operate a registration review system to phase them out. When renewing registrations or reporting changes in executives due to shareholder changes, the FIU will comprehensively consider money laundering risks, Korean won market operation capabilities, and user protection aspects during the review. To prevent user damage in cases where providers arbitrarily cease operations, the FIU plans to establish and encourage adherence to business processing procedures. Monitoring of customer fund return status will also be strengthened.
In addition, the focus of AML-related supervision and inspections will be redefined from detecting and punishing violations to promoting substantial AML capacity building. The FIU plans to provide the results of biannual institutional compliance evaluations by sector to encourage financial companies to improve vulnerabilities on their own. If improvements are insufficient, on-site inspections will be actively recommended to enhance operations.
Alongside this, the inspection focus will shift to checking the substantive capabilities of suspicious transaction monitoring systems. Previously, emphasis was placed on detecting simple regulatory violations such as delayed reporting. The sanction approach will also be improved to focus more on strengthening the overall AML system capabilities rather than detailed punishments for individual violations.
Lee Yoon-soo, head of the FIU, stated, "We will prioritize urgent tasks," and emphasized, "To prepare in advance for the enforcement of the Virtual Asset User Protection Act scheduled for the second half of this year and the large-scale renewal registrations, we will swiftly implement institutional improvements to strengthen the registration review of virtual asset service providers, and based on this, we will prepare and respond smoothly to the renewal registrations."
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