South Korea Launches Crypto Crime Unit to Tackle Fraud

• South Korea will upgrade its crypto crime task force into a full prosecution unit by March 2025.
• The unit has already indicted 41 people and seized $97.5M in crypto and luxury assets.
• Authorities aim to strengthen crypto regulations and prevent fraud with stricter enforcement.

South Korea is set to establish a dedicated unit to tackle cryptocurrency-related crimes. The government will upgrade the existing Joint Investigation Unit (JIU) into a full department within the prosecution service. This move aims to strengthen law enforcement efforts against rising virtual asset crimes. The Ministry of Justice plans to finalize the transition by February or March 2025. The decision follows a surge in crypto-related fraud, price manipulation, and illegal transactions. Authorities believe a formalized unit will enhance their ability to combat these offenses effectively.

The JIU was initially formed as a task force in mid-2023. The agency has launched major initiatives to address cryptocurrency offenses over the past year. An investigative team has indicted 41 individuals followed by the arrest of 18 individuals who engaged in fraudulent cryptocurrency operations.

The unit seized assets with a total value of 141 billion South Korean won that equals $97.5 million. The recovered assets comprise of Bitcoin alongside alternative cryptocurrencies, luxury properties, and expensive vehicles. Officials advocate unit formalization to gain essential resources for handling an expanding set of responsibilities.

The Ministry of Justice is working on amendments to the Enforcement Decree of the Prosecutor’s Office Act. This change will grant the new department more legal authority and additional personnel. The unit will consist of prosecutors, financial regulators, and experts from government agencies. Key partners include the Financial Supervisory Service and the Financial Intelligence Unit. These agencies will collaborate to track and prosecute crypto-related offenses. Authorities expect this structure to improve the government’s ability to investigate and prevent financial crimes.

Related: South Korea Unveils New Rules for Corporate Crypto Accounts

The government has identified cryptocurrency fraud as a growing concern. Price manipulation schemes and Ponzi scams have led to massive financial losses for investors. The formalization of the JIU is part of broader efforts to regulate the fast-evolving crypto market. Authorities plan to introduce stricter rules and monitoring mechanisms. The new department will focus on investigating illicit trading activities and enforcing financial regulations.

The South Korean government is currently seeking public feedback on the proposed changes. Officials aim to finalize the establishment of the unit by early March 2025. Lawmakers stress the importance of proactive measures to maintain investor confidence in the crypto industry. Regulators believe that a stronger legal framework will enhance market stability.

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