16 crypto exchanges investigated for illegal trading in South Korea

There has been an increase in crypto scams in the past few months. South Korea has taken measures to protect crypto-connected people from financial harm. In this episode, the South Korean authorities have started an investigation of 16 crypto exchanges for doing business illegally. These exchanges include Phemex, KuCoin, Poloniex and Digifinex.

The Korea Financial Intelligence Unit (KoFIU) has informed authorities about crypto exchanges operating in South Korea without registration. KoFIU had earlier directed all foreign crypto exchanges to make the information available. These 16 exchanges did not provide information. Under South Korean law, unregistered firms that conduct business illegally can face jail terms and fines for their representatives. Apart from this, these firms can also be barred from applying for license for a particular period.

In this regard, South Korea’s Financial Services Commission (FSC) said in a blog post, “Transfer of virtual assets from these firms is prohibited.” Recently, South Korean police have started confiscation of cryptocurrencies for non-payment of fines. However, this is being done on a trial basis. Police recently confiscated around 5 crore KRW of cryptocurrency from a person who violated traffic rules multiple times for not paying a fine of around 25 lakh KRW.

A local media report said that the government of South Korea has chosen the city of Gunpo for this test. This test appears to be successful. In the first half of this year, the city’s police have recovered almost 90 per cent of the fines for traffic violations. Earlier, about $50 million worth of cryptocurrency was seized from around 12,000 people suspected of evading tax. There has also been a proposal to confiscate illegally acquired cryptocurrencies in Japan.

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