South Korea's customs authorities have dismantled an international cryptocurrency laundering network that processed 148.9 billion won ($101.7 million) through unauthorized foreign exchange schemes.
Three Chinese nationals were referred to prosecutors for violating the Foreign Exchange Transactions Act, the Korea Customs Service announced.
The suspects allegedly operated between September 2021 and June 2025, disguising illicit fund transfers as legitimate cross-border payments for cosmetic surgery and overseas education expenses.
Scheme Details
The laundering operation exploited South Korea's booming medical tourism industry to conceal illegal foreign exchange transactions. Overseas clients transferred foreign currencies like U.S. dollars and Chinese yuan for services at South Korean institutions, according to Seoul Main Customs Office investigators.
The operators then purchased cryptocurrency on overseas exchanges, transferred digital assets to South Korean wallets, and converted them to Korean won on local platforms. To evade monitoring, suspects spread converted funds across numerous domestic bank accounts.
Context and Significance
The bust comes one week after Korea Customs Service announced year-round inspections targeting illegal foreign exchange transactions following discovery of a $290 billion gap between trade proceeds and reported trade values. A separate 2025 foreign exchange inspection found 97% of surveyed companies in one industry engaged in illicit transactions totaling 2.2 trillion won.
South Korea's domestic cryptocurrency market reached 95 trillion won ($64.6 billion) in capitalization as of June 2025, with average daily trading volume of $4.35 billion, according to Financial Services Commission data.
The case highlights how criminals increasingly combine cryptocurrency with traditional banking channels and fake documentation to exploit regulatory gaps between digital asset monitoring and foreign exchange controls. Prosecutors are considering charges related to illegal foreign exchange trading, money laundering and financial reporting violations, with suspects facing potential lengthy prison sentences if convicted.