South Korea’s Financial Intelligence Unit (FIU) has reportedly fined crypto exchange Coinone 5.2 billion won (about $3.5 million) and imposed a three month partial business suspension over anti money laundering (AML) violations, according to local media reports. The FIU operates under the Financial Services Commission and is responsible for enforcing compliance standards across virtual asset service providers.
The suspension is set to run from April 29 to July 28. During this period, Coinone will be prohibited from allowing new customers to deposit or withdraw funds for crypto trading, while existing users will still be able to trade normally, according to reports.
Thousands of Identity Verification Failures Identified
The regulator found approximately 70,000 cases of identity verification failures, including incomplete or inconsistent customer information. Reports also indicated around 40,000 instances of customer due diligence issues and roughly 30,000 transaction restriction violations where required verification procedures were not properly enforced.
In addition, Coinone allegedly conducted about 10,000 transactions with 16 unregistered overseas crypto exchanges, raising further compliance concerns. The exchange’s chief executive is expected to receive an official reprimand, and the firm has been given 10 days to submit a formal response before the penalties are finalized.
Wider AML Crackdown in South Korea’s Crypto Sector
The action against Coinone follows similar enforcement measures against Bithumb, which recently faced suspension notices over AML violations and dealings with unregistered overseas operators. Regulators have intensified oversight of South Korea’s crypto exchanges amid growing concerns about compliance gaps and cross-border transaction risks.
Disclaimer
This content is for informational purposes only and does not constitute financial, investment, or legal advice. Cryptocurrency trading involves risk and may result in financial loss.