The New York State Department of Financial Services has asked two South Korean financial authorities to share cryptocurrency-related data they obtained from their recent inspections of six major Korean banks.
The US Wants South Korean Crypto Data
The New York State Department of Financial Services (NYDFS) has asked South Korea’s Financial Supervisory Service (FSS) and Financial Intelligence Unit (FIU) to share the data obtained from their inspections of six major Korean banks, local media report. The NYDFS supervises banks, insurers, and financial institutions in the US. It is also responsible for issuing New York’s infamous Bitlicense since 2014.
The South Korean FSS and FIU inspected Woori Bank, KB Kookmin Bank, Shinhan Bank, Nonghyup Bank, Korea Development Bank (KDB), and Industrial Bank of Korea (IBK) between January 8 and 11, as news.Bitcoin.com previously reported. However, the authorities extended the inspection period to January 16. The purpose of the inspections was to ensure that banks fulfil their anti-money laundering (AML) obligations related to services they provide to cryptocurrency exchanges.
In addition to requesting results of the probes into the six banks, the NYDFS also “asked to see the banks’ internal regulations on cryptocurrency dealings,” Chosun reported and quoted a Korean government official saying:
There’s a lot of concern from foreign governments about the regulations being imposed on cryptocurrency trading…With the Korean government conducting on-site inspections and establishing guidelines, financial regulators in New York seem to be gathering information for research purposes.
Crypto Countermeasures & AML
The Korean government has been actively devising cryptocurrency countermeasures. Following the inspections of the six banks, the FIU created a set of anti-money laundering guidelines for banks to follow when dealing with cryptocurrencies. Concurrently, the regulators also published their countermeasures for cryptocurrency regulations which they promised back on December 28. Earlier this month, the government also mandated that crypto exchanges share their user data with banks under the new real-name account system.
A Korean financial official was quoted by the Korea Times saying, “It seems like the whole world is wondering about our virtual currency countermeasures.”
According to Maekyung, on January 25, US Treasury Secretary Sigal Mandelker discussed how to strengthen anti-money laundering measures related to cryptocurrencies as well as international cooperation measures with Vice Chairman of the Korean Financial Service Commission (FSC), Kim Yong-bum. Mandelker said at a US Senate Banking Committee hearing on the Anti-Money Laundering Act:
We will actively crack down on any virtual currency exchange that does not have a money laundering safety net.
What do you think of the NYDFS asking South Korea for their Crypto trading data? Let us know in the comments section below.
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Author: Kevin Helms