KuCoin Among 16 Exchanges Illegally Operating in Korea
The Financial Services Commission informed the investigative organizations regarding sixteen non-reporting institutions engaged in the exchange of virtual assets including KuCoin within Korea. The institutions specified that these exchanges have infringed the Specific Financial Information Act and did not report to the authorities.
Investigative Agencies Alerted by FSC about KuCoin
In line with the present law, the operators of the non-reported business are not permitted to carry out their activities, however, the regulators have discovered that the firms have been participating in sales operations including the provision of Korean services via their websites as well as conducting the occasions to allure the customers in Korea. On 18th August, it was declared by the Financial Services Commission’s Financial Intelligence Unit (FIU) that the investigative organizations have been alerted by it regarding the respective companies.
The sixteen companies that were found infringing the Specific Financial Information Act. They took into account Pionex, DigiFi, BTCC, BTCEX, Poloniex, ZoomEX, AAX, CoinEX, CoinW, Bitglobal, ZB.xom, Bitrue, XT.com, Phemex, MEXC, and KuCoin. As per the respective Act, if an entity is interested in conducting a business dealing with virtual assets within the jurisdiction of Korea, it must abide by the laws prescribed by the authorities. The most important among them is the acquisition of the Information Security Management System (ISMS) authorization under the FIU.
These firms including KuCoin also need to report to the regulatory agency periodically. In the case of non-reporting businesses, the authorities may penalize them with imprisonment of up to five years. Otherwise, they might be liable to pay a fine of nearly 50M won. Apart from that, such a business cannot be categorized as a domestic business of virtual assets for a period of the impending five years.
The respective law is to be implemented on both internal as well as foreign business operators. A criterion has been specified by the FIU for the operations related to domestic sales. This includes supporting KRW payment or transfer, marketing services and products to Korean citizens.
2 days earlier, Zipmex crypto exchange received a 3-month creditor protection.
FIU to Investigate Credit Card Firms to Ensure Virtual-Asset Services Are Not Offered
In 2021’s July, the respective foreign businesses have been notified by the FIU that they require reporting their operations. This event was witnessed in advance of the deadline specified for reporting according to the Specific Financial Information Act (also known as the Special Act). Nevertheless, the reports brought to the front that the alerted businesses did not pull back and kept on carrying out their operations without any reporting.
In the words of the FIU, the services related to the Korean language were being provided by these businesses on the formal web portals thereof. They were also reported to be organizing the events to fascinate the consumers within Korea. The other provided services dealt with the utilization of credit cards to buy virtual assets. Hence, the FIU has made a strategy to examine the companies providing credit cards to guarantee that they do not provide the services of purchasing virtual assets via credit cards.
