South Korea busts alleged $102 million crypto laundering scheme: report

Quick Take

South Korean customs authorities have busted an international illegal money exchange ring that allegedly laundered nearly $101.7 million through cryptocurrency transactions, according to Yonhap news agency.
The move comes a week after the customs agency announced year-round inspections targeting illegal foreign exchange transactions, following the discovery of a $290 billion gap between trade proceeds and reported trade values.

South Korean customs investigators have disrupted an international money laundering network that allegedly processed 148.9 billion won ($101.7 million) using cryptocurrency and the domestic banking system.

The Korea Customs Service (KCS) said Monday that it has referred three individuals to prosecutors for alleged violations of the Foreign Exchange Transactions Act, Yonhap news agency reported.

According to the report, the agency alleges that the ring operated from September 2021 through June 2025, moving funds under the guise of legitimate expenses like cosmetic surgery or tuition. To evade detection, the suspects allegedly purchased crypto assets in multiple jurisdictions, transferred them to crypto wallets in South Korea, converted them into local currency, and dispersed the funds through numerous South Korean bank accounts, the report said.

The enforcement action comes as South Korean authorities step up scrutiny of illegal foreign exchange activity. On Jan. 13, the KCS announced year-round "intensive inspections" targeting underground money exchange operations that could threaten exchange rate stability.

The crackdown is unfolding against a backdrop of widening discrepancies in South Korea's foreign exchange flows. The gap between trade proceeds handled by banks and the value of goods reported to customs reached roughly $290 billion in 2025 — the largest difference in five years — heightening concerns over illicit capital movements, according to the statement from the KCS last week.

A separate foreign exchange inspection targeting a specific industry in 2025 found 97% of surveyed companies were engaged in illicit transactions, totaling 2.2 trillion won, the KCS said.

Meanwhile, the Monday crackdown places a burgeoning domestic crypto market in the spotlight. According to Financial Services Commission data, the South Korean crypto asset market capitalization reached 95 trillion won ($64.6 billion) as of June 2025, with average daily trading volume of $4.35 billion.

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