Guri Scrap Smuggling Company Caught... Investigation Expands to Include Hawala and More

Eight companies were caught for smuggling copper scrap or underreporting its value to customs. Customs authorities plan to expand investigations into whether these companies were involved in illegal money transfers.

The Busan Regional Customs Office of the Korea Customs Service announced on the 28th that it had identified eight companies suspected of violating the Customs Act.

A customs officer is inspecting copper scrap at the seizure site to check its condition. Provided by Busan Regional Customs Office, Korea Customs Service.

An employee of a freight forwarding company who assisted these companies by preparing trade documents disguising copper scrap as iron scrap was also booked and sent to prosecution.

Earlier, Busan Customs selected target companies for investigation based on media reports in March that large amounts of copper scrap were being exported overseas to countries such as China.

At that time, Busan Customs focused on simultaneously raiding the suspected companies nationwide to secure related evidence, anticipating that suspects might destroy evidence after learning about the ongoing crackdown in the industry.

As a result, it was confirmed that the eight companies smuggled copper scrap disguised as iron scrap, totaling 13,000 tons (worth approximately 99.8 billion KRW), by underreporting actual sales to evade domestic taxes, or exported 55,000 tons of copper scrap (worth approximately 455.5 billion KRW) while declaring lower export prices, pocketing a difference of 374.3 billion KRW.

Overview of Illegal Export of Copper Scrap. Provided by Busan Regional Customs Office, Korea Customs Service

Currently, Busan Customs is expanding the scope of the investigation to uncover additional offenses, considering the possibility that the suspect companies may have smuggled copper scrap using similar methods in the past.

They are also investigating some companies for violating the Foreign Exchange Transactions Act by illegally receiving the difference gained from export price manipulation through virtual asset money laundering.

During the investigation, Busan Customs also achieved the seizure of 68 tons of copper scrap (worth approximately 600 million KRW) intended for smuggling (disguised as iron scrap) to China and Malaysia by Company A in Gyeongnam and Company B in Gyeongbuk before shipment.

Busan Customs stated, “To prevent important resources such as copper from being indiscriminately exported overseas and causing damage to domestic industries, we plan to strengthen the collection and analysis of risk information and conduct planned crackdowns.” They also urged the public to actively report any illegal activities such as smuggling or export-import price manipulation to the “Korea Customs Service Smuggling Report Center.”