[Issue Interview] K Bank Records Lowest Number of Scam Accounts Among Banks: What's the Secret?

Interview with Tak Yunseong, Head of Consumer Protection
"Banks Are Public Institutions, Customer Protection Comes First"
Safety Lab Launched from CEO Choi Woohyung's Single Comment
Promoting Trust Through 'Safety'
First-of-Its-Kind Se

"I believe that banks are public institutions. Therefore, regardless of whether there is an obligation or not, I think banks should voluntarily make efforts to prevent consumer harm. This is one of the key principles of the K Bank Safe Lab."

Tak Yunseong, Head of Consumer Protection at K Bank, stated in a recent interview with Asia Economy, "Regardless of whether the customer is at fault, it is important for the bank to do its utmost to prevent financial fraud."

This principle upheld by Tak is reflected in tangible results. K Bank accounts are among the least used for scams such as voice phishing within the banking sector. According to data on account suspension cases under the Telecommunications Financial Fraud Refund Act from the past five years for the five major banks (KB Kookmin, Shinhan, Hana, Woori, NH Nonghyup) and internet banks (K Bank, Kakao Bank, Toss Bank), K Bank recorded the lowest number of account suspensions among the eight banks last year, with 2,732 cases. This is about 40% of the average number (6,611 cases) for the other banks. As of April this year, the number was also the lowest among the eight banks, with 1,450 cases.

Tak Yunseong, Head of Consumer Protection at K Bank, is being interviewed by Asia Economy. Photo by Yoon Dongju

K Bank did not excel at countering financial fraud from the beginning. In 2022, as the number of customers increased, the number of account suspensions also surged. It rose from 2,316 cases in 2021 to 5,285 cases in 2022, ranking third among the eight banks. The key was the immediate account unfreezing system developed by the Consumer Protection Office. In 2023, K Bank analyzed its account suspension records and found that about 30% of all suspensions were estimated to be due to account freezing. Account freezing is a new type of scam that exploits the account suspension system, which is intended to prevent voice phishing by freezing financial transactions. If K Bank determines that a customer is suffering from account freezing abuse, it lifts the suspension within one hour after a verification process. Using artificial intelligence (AI) and other technologies, the bank thoroughly verifies the situation, and if no criminal activity is suspected, it releases the suspension on the remaining funds except for the amount in question.

Tak is striving to build a brand image of "a bank customers can trust with their money" by establishing the Safe Lab within the Consumer Protection Office. This initiative began with a suggestion from K Bank CEO Choi Woohyeong, who said, "Let’s actively promote our differentiated services." The lab not only develops K Bank's own financial fraud prevention services, but also educates customers on how to prevent fraud and introduces services from other institutions. If you see a "Safe" mark in the K Bank application, it indicates the involvement of the Safe Lab.

Of course, there were objections to establishing the lab. Some argued that trust in banks is merely a "hygiene factor" in management theory-just as cleanliness is a basic requirement for the human body, trust is a fundamental prerequisite for banks, and higher trust does not necessarily attract more customers. Nevertheless, Tak maintained his stance on the necessity of the lab. He said, "The world has changed a lot, and now is a time when safety is crucial. With the rise of non-face-to-face fraud causing social problems, I thought that for banks that effectively prevent such crimes, trust could become a 'motivating factor' rather than just a hygiene factor." He added, "The fact that the very first page and first button in the K Bank app menu leads to the Safe Lab's 'Financial Safety' page is the thing I am most proud of since joining K Bank."

The achievements of the lab are closely linked to Tak's career. He utilizes his experience as Director of the Global Finance Division at the Financial Services Commission and his work at the Financial Action Task Force (FATF) in the private sector. Tak explained, "The K Bank Consumer Protection Office is at the forefront of preventing voice phishing and financial fraud, directly encountering how criminals operate. Although I have dealt with financial fraud in the past, I joined K Bank to broaden my contact with customers and apply my experience in practice, thereby expanding my professional horizons."

Tak announced that the lab will launch AI-powered services in the second half of this year. A representative service is the "Telephone Fraud Prevention" feature, which monitors suspicious transactions and communicates with customers to prevent losses-even in cases where the victim, not an impersonator, makes the transfer. In addition to services that detect malicious apps and analyze smishing messages, K Bank is preparing a safe transaction service for secondhand deals in collaboration with "TheCheat," a scam information sharing site, to verify the safety of recipient accounts. The immediate account unfreezing system has also been enhanced with machine learning (ML) for automatic detection since May, further improving existing services.

Tak emphasized that individuals must take many precautions to prevent financial fraud, especially minimizing the exposure of personal information. He said, "You should avoid exposing your personal information on social networking services (SNS) or storing your ID on your mobile phone. It is safer to keep such items offline to avoid becoming a target for scammers."