South Korean authorities have uncovered an underground remittance operation that moved roughly 150 billion won (about $100 million to $110 million) through digital assets, according to local media reports.
The Korea Customs Service has referred three suspects for prosecution, including a Chinese man in his 30s, on charges of violating the Foreign Exchange Transaction Act.
Over the past four years, the illicit operation has allegedly laundered more than $100 million collected through WeChat Pay and Alipay. This money was converted into cryptocurrencies through overseas exchanges and transferred into South Korean wallets before being converted back to fiat currency.
The group disguised the transfers as legitimate expenses, including for cosmetic surgery costs and tuition fees for students abroad.
Crypto-Linked Illegal Remittance Scheme
The case ranks among the largest crypto-linked illegal remittance schemes uncovered in South Korea in recent years. It highlights the growing challenges authorities face in tracking cross-border financial crimes involving digital assets.
In December, a woman in her thirties was jailed for laundering about $180 million in illicit funds through cryptocurrencies, one of the largest such operations identified by regulators.
“The fact that she found her way into this world via a group chat shows just how savvy criminals have become, using encrypted channels to operate under the radar of traditional banking systems.”
The scale of such cases highlights the challenges regulators face when trying to track illicit crypto flows.
South Korea Tightens Crypto Oversight
The latest investigation comes as South Korea moves to tighten oversight of crypto-related financial activity.
The country’s Financial Services Commission is preparing to expand Anti-Money Laundering rules. This expansion will apply Travel Rule requirements to transactions of 1 million won ($680), requiring exchanges to collect data on these transfers.
This development seeks to stop potential money laundering operations from breaking up transactions into sub-$680 increments to avoid detection.
Officials plan to finalize the new framework in the first half of 2026 and submit legislative amendments to the National Assembly.