Eun Sung-soo: "Is it reasonable to exempt money laundering and terrorist financing?" Firmly rejects Bank Association's demand

Eun Sung-soo, Chairman of the Financial Services Commission, is listening to the remarks of Prime Minister Kim Boo-kyum at the Cabinet meeting held at the Government Seoul Office in Jongno-gu, Seoul on the 15th. Photo by Kim Hyun-min kimhyun81@

[Asia Economy Reporter Kim Jin-ho] Eun Sung-soo, Chairman of the Financial Services Commission, expressed a negative stance regarding the request for exemption from liability for banks in case of incidents such as money laundering occurring at cryptocurrency exchanges, saying, "What use would that be?" It is interpreted that he has effectively rejected the opinion letter related to exemption submitted by the Korea Federation of Banks to the Financial Services Commission.

On the 1st, Chairman Eun met with reporters at the Seoul Center for Financial Inclusion in Jung-gu, Seoul, and said, "This is the first time I have heard of granting exemption for money laundering or terrorist financing," adding, "Would the U.S. or others tolerate granting exemption for terrorist financing?" He also mentioned at the National Assembly's Political Affairs Committee plenary session held that morning that "the primary responsibility for money laundering lies with the banks."

Chairman Eun further stated, "Even if our financial authorities grant exemption, would it be acceptable if banks are fined in the U.S. for anti-money laundering violations?" and "There could be cases where our banks are unable to conduct transactions in New York due to money laundering issues."

The Korea Federation of Banks recently submitted an opinion to the Financial Services Commission requesting that even if money laundering issues arise at cryptocurrency exchanges, banks should not be held responsible if there is no intentional or gross negligence during the real-name verification and deposit/withdrawal account screening process.

However, as Chairman Eun said, even if the financial authorities establish 'exemption criteria' related to money laundering, its effectiveness is uncertain. Even if exemption criteria are established, they would only apply domestically and cannot serve as a means to avoid sanctions from foreign governments or financial authorities.

In particular, the U.S. is highly sensitive to money laundering incidents. If problems occur, banks' assets in the U.S. may be frozen, and sanctions such as blocking access to the U.S. financial network may be imposed. Being blocked from accessing the U.S. financial network means that dollar transactions cannot be conducted. For banks, this is practically a death sentence.

Regarding the establishment of a dedicated organization for cryptocurrency exchanges, he replied that consultations are ongoing with the Ministry of the Interior and Safety. Chairman Eun explained, "Currently, we are actively providing consulting and handling registration reviews," adding, "We cannot do it with enthusiasm alone, so we are saying that manpower is needed."

On the issue of the sale of Citibank, he reaffirmed his position hoping for a full sale. Chairman Eun said, "A full sale that maintains employment and protects consumers aligns with the interests of the bank."

This content was produced with the assistance of AI translation services.