TechFlow reported that according to the Korean Daily Economic News, the Financial Information Analysis Unit (FIU) of the Financial Services Commission of South Korea found at least 500,000 cases of suspected violations of customer identity confirmation (KYC) obligations during the renewal review of Upbit Exchange. FIU is currently reviewing the illegality of these cases one by one.
It is reported that the violations found this time mainly involved some accounts using unclear identity documents to complete registration. According to South Korea's (Specified Financial Transaction Information Act), virtual asset exchanges must renew their operating licenses every three years, and for violations of KYC obligations, a fine of up to 100 million won per case may be imposed.
These unverified accounts may be used for money laundering or other illegal activities. As an important part of the Anti-Money Laundering (AML) and Counter-Terrorist Financing (CTF) compliance requirements, the KYC procedure requires exchanges to ensure that users submit valid identification and complete identity verification. The FIU's review of Upbit is still ongoing, and the final penalty result and business renewal decision have attracted much attention from the market.