South Korea Fines Korbit $1.9M for AML Violations

I Must Say It’s Not Good That Korbit Got Fined ₩27.3 Billion By South Korea’
Financial Intelligence Unit For Breaching AML Regulations
In A Major Blow To The Cryptocurrency Exchange, The Unit Has Imposed A Fine Of Approximately $1.89 Million After Conducting An Extensive On-Site Inspection In October 2024
The Sanctions Were Officially Confirmed On December 31
The Regulator Identified Several Key Violations Including Around 22,000 Instances Of Non-Compliance With Customer-Due-Diligence And Transaction-Restriction Obligations
Over 12,800 Of These Cases Involved Failures In Customer Identification Processes Such As Accepting Incomplete Identity Documents Approving Accounts With Incorrect Addresses And Neglecting To Re-Verify Customer Identities When Necessary
This Was A Major Slip-Up On Korbit’s Part As They Allowed Transactions For Customers With Upgraded Money-Laundering Risk Ratings Without Conducting Further Checks
Moreover The Exchange Facilitated 19 Crypto-Asset Transfers Involving Three Overseas Virtual-Asset Service Providers That Were Not Registered Under South Korean Law Which Is Explicitly Prohibited
To Make Matters Worse Korbit Failed To Conduct Money-Laundering Risk Assessments Before Launching New Products Including Certain NFT-Related Services
This Failure Led To 655 Violations As The FIU Uncovered The Exchange’s Lack Of Due Diligence
In Addition To The Institutional Penalty The FIU Has Taken Disciplinary Actions Against Senior Management Korbit’s Chief Executive Received A Formal Caution

And The Compliance Reporting Officer Was Issued A Reprimand The Regulator Emphasized That These Measures Reflect The Severity Of The Breaches And The Need For Corrective Actions
The FIU Made It Clear That Serious Violations Of AML Regulations Will Be Dealt With Strictly Underlining The Importance Of Strengthening AML Capabilities And Compliance Frameworks Among Virtual-Asset Service Providers
Now Korbit Is Dealing With The Fallout From This Decision The FIU Stated That Further Details Of The Sanctions Will Be Published On Its Website After Korbit Is Given The Opportunity To Submit Its Response
The Regulator Also Warned That Any Further Breaches Will Be Dealt With Severe Consequences Which Will Give No Room For Misinterpretation
This Development Comes At A Time When Mirae Asset Group Is Engaged In Talks To Acquire Korbit Mirae Asset Consulting Is Leading The Discussions For The Financial Services Company Which Has Signed A Memorandum Of Understanding With Korbit’s Major Shareholders
NXC Holdings Controls Approximately 60.5% Of Korbit Sk Planet Holds Another 31.5% The Ownership Structure And Acquisition Talks Are Being Closely Watched By Investors And Industry Experts Alike