| The Financial Transaction
Reports Act (FTRA) stipulates the establishment
of the KoFIU, a specialized national agency
responsible for receiving, analyzing and disseminating
information on suspicious transactions. The
KoFIU's responsibilities include providing
information on suspicious transactions
that require investigation to the Public
Prosecutor's Office, the National Police
Agency, the National Tax Service, the
Korea Customs Service, the Financial Supervisory
Commission and the National Election Commission. |
| Through this legislation,
a suspicious transaction reporting (STR) system
has been introduced. Under the STR system,
financial institutions are required to report
to KoFIU transactions over 20 million won
or the foreign exchange equivalent of over
US $10,000 that are suspected of laundering
criminal proceeds or tax evasion. Financial
institutions may also file a report on suspicious
transactions less than such amounts when there
are reaso- nable grounds for suspicion. Financial
institutions are required to report to
KoFIU in accordance with the FTRA. These
financial institutions include banks,
securities companies, insurance companies,
asset management companies and futures
com- panies In addition, the non-financial
institutions, such as venture capital
companies, corporate restructuring companies,
etc., are also required to report to KoFIU.
According to the FTRA, the relevant authorities
and their employees are pro- hibited from
disclosing the obtained information, and
they should provide such information to
the law enforcement agencies for investigative
purposes only. Otherwise, they will be
subject to imprisonment for five years
or less and/or to a fine of 30 million
won or less (approximately US$25,000).
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