South Korea to empower FIU over unregistered crypto firms

South Korea may grant the FIU direct authority to investigate and penalize unregistered crypto firms, allowing public reporting and stronger enforcement.

South Korean lawmakers have proposed an amendment to the Act on Reporting and Using Specified Financial Transaction Information. The bill aims to grant the Financial Intelligence Unit (FIU) direct authority to investigate and penalize unregistered virtual asset service providers (VASPs). Submitted by Eom Tae-young and nine other lawmakers, the proposal would allow individuals to report suspected violations directly to the FIU. The agency would then be empowered to investigate, analyze evidence, file complaints, request criminal investigations, and refer cases to law enforcement. This legislative move addresses regulatory gaps, as the FIU currently depends on reports from financial institutions or police, limiting proactive enforcement. Lawmakers believe the bill will strengthen oversight of South Korea’s crypto market and improve protection against illegal operations by unregistered firms. The proposal is pending approval by the National Assembly.