FIU to Conduct On-Site Inspections Next Month for Vulnerable Areas Including Virtual Asset Operators and Loan Businesses

[Asia Economy Reporter Ji-hwan Park] The Financial Intelligence Unit (FIU) will begin on-site inspections of virtual asset service providers, casino operators, and loan businesses starting next month. The aim is to expand direct inspections to preemptively block money laundering risks in new and high-risk sectors. In particular, the focus will be on establishing anti-money laundering systems for virtual asset service providers.

On the 16th, the FIU announced the "2022 Inspection Operations Direction" containing these details. The FIU plans to concentrate on enhancing inspection capabilities in new and high-risk sectors based on money laundering risk assessment results. This is to efficiently utilize limited inspection resources in response to the digitalization of financial transactions and the sophistication and intelligence of money laundering crimes.

The FIU will conduct on-site inspections of electronic finance companies (124 firms) and loan businesses (60 firms) that have been subject to anti-money laundering obligations for over two years. The selection of targets will focus on companies with relatively low internal control levels compared to their money laundering risks based on user numbers and transaction volumes. Inspections of nine inland casino operators, which were temporarily suspended due to COVID-19 closures, will also resume.

Additionally, inspections will be strengthened on common risk factors identified across multiple sectors or companies through the Financial Supervisory Service (FSS), such as money laundering risks of overseas subsidiaries and risks related to the use of firm banking.

Currently, the FIU entrusts inspections and some sanction tasks to delegated inspection agencies such as the FSS, the National Federation of Mutual Savings Banks, the Korea Post, and the Korea Customs Service. The FIU plans to enhance the expertise of delegated inspections through on-site audits of these organizations.

In particular, for virtual asset service providers, which belong to newly emerging sectors, the FIU plans to focus on establishing anti-money laundering systems through comprehensive and partial inspections. It will check the status of anti-money laundering system establishment under the Act on Reporting and Using Specified Financial Transaction Information for registered operators. Priority will be given to verifying the implementation of improvements and supplements raised during the registration review process, and in the early stages of enforcement, the FIU will monitor whether customer due diligence and anti-money laundering systems are properly implemented and settled. Partial inspections will be conducted for operators under watch to focus on the actual operation of anti-money laundering measures.

The FIU plans to finalize the inspection targets through re-examinations of virtual asset service providers, which had been deferred until the end of this month, and prepare detailed inspection plans through operator status checks. Starting next month, on-site inspections will also begin for virtual asset service providers, financial companies, casino operators, and the National Federation of Mutual Savings Banks, which are subject to FIU and FSS inspections. A Financial Services Commission official stated, "By next month, through meetings with delegated inspection agencies, we plan to establish directions for anti-money laundering inspection tasks entrusted to the National Federation of Mutual Savings Banks, Korea Post, and others."

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