The South Korean Ministry of Justice, through a Government Business Report released on Jan. 26, announced the blueprint for a “virtual currency tracking system” to curb money laundering and recovery of proceeds of crime. .
Application of the ‘virtual currency tracking system’
The ‘virtual currency tracking system’ will improve tracking of digital transactions, retrieve necessary information and confirm sources before completing transactions, according to a local news outlet.
In addition, the ministry said that they were reviewing the entire scientific research platform and updating it to combat increasingly sophisticated crimes.
The first half of the year will see a proper reorganization of the current forensic investigation infrastructure. The immediate priority is to build a cloud system to store forensic data. This will allow other related agencies to use the available digital forensic system (D-Net) when processing cases.
Agreement with virtual currency exchange houses
In October 2022, the South Korean police signed an agreement with the top five local cryptocurrency exchanges to curb crypto-related crime. The agreement provides a cordial relationship with investigators that allows for a smooth flow of information to eliminate digital asset crime. The National Police Agency, through the Cyber Investigation Office, applauded the move, saying it was a show of commitment to eliminate the illicit exploitation of virtual assets and safeguard the interests of customers.
The National Police Agency uses the system of professional investigators to strengthen its capabilities to address virtual currency investigations. Cryptography experts are investigating the dark web to unravel the use of virtual currencies in drug trafficking and other crimes.
Strengthening of the control body
South Korean agencies have been working to strengthen the virtual currency platform through regulations. In November 2022, the South Korean Ministry of ICT established a series of ethical guidelines to combat crime in the metaverse.
South Korean authorities recently accused V Global’s top executives of defrauding investors. The executives had instructed new customers to deposit 6 million Korean won into their accounts and earn 18 million, which is equivalent to a 300% return on investment. Customers later said the company defrauded them, forcing authorities to intervene in what ended up arresting and jailing V Global executives.
Mr. Lee, CEO of V Global, was sentenced to 22 years in prison for masterminding the scheme.
