- Upbit faces scrutiny over 600,000 KYC issues, risking heavy fines and raising concerns about money laundering.
- South Korean regulators intensified their focus on Upbit’s KYC failures as its business license renewal remains uncertain.
- Upbit’s compliance lapses could result in severe penalties, setting a critical precedent for crypto regulations in South Korea.
Upbit is charged with many violations of Know Your Customer laws according to Wu Blockchain on X. Authorities found between 500,000 and 600,000 cases that have not been verified during an analysis of license renewals. Because these abnormalities could be linked to money laundering or other illicit activities, regulators are quite concerned about them.
The potential issues were found during an inspection that began in August by South Korea’s Financial Services Commission. These findings have raised concerns about whether Upbit is following laws to prevent money laundering and terrorism financing. The inspectors discovered cases where accounts were created using unclear ID pictures or without proper verification.
KYC Compliance Under the Spotlight
KYC compliance is essential for preventing financial crimes. However, Upbit allegedly failed to implement it correctly in numerous cases. Customers reportedly bypassed proper verification by submitting blurred identification documents. This lapse could facilitate illegal activities, including fraud or terrorism financing.
Significantly, virtual asset exchanges in South Korea must renew their business licenses every three years. Any violations during this process could lead to severe penalties. Under the Special Financial Transaction Information Act, each case could result in a fine of up to 100 million won.
Business License Renewal at Risk
Additionally, Upbit’s business license renewal hangs in the balance as financial authorities meticulously examine the violations. While fines for non-compliance are standard, the sheer volume of flagged cases intensifies the stakes.
Read CRYPTONEWSLAND on
google news
Moreover, industry insiders speculate this prolonged review reflects the severity of the situation. Upbit’s renewal outcome could set a precedent for future regulatory actions against crypto exchanges in South Korea.
The exchange has maintained its stance on the issue. An official stated that the FIU prohibits sharing ongoing case details. However, the exchange’s lack of internal awareness highlights regulatory opacity in handling such matters. Consequently, the focus remains on how many confirmed violations emerge from the flagged cases. This scrutiny underscores South Korea’s firm stance on enforcing AML and CTF measures.
disclaimer read moreCrypto News Land, also abbreviated as "CNL", is an independent media entity - we are not affiliated with any company in the blockchain and cryptocurrency industry. We aim to provide fresh and relevant content that will help build up the crypto space since we believe in its potential to impact the world for the better. All of our news sources are credible and accurate as we know it, although we do not make any warranty as to the validity of their statements as well as their motive behind it. While we make sure to double-check the veracity of information from our sources, we do not make any assurances as to the timeliness and completeness of any information in our website as provided by our sources. Moreover, we disclaim any information on our website as investment or financial advice. We encourage all visitors to do your own research and consult with an expert in the relevant subject before making any investment or trading decision.
