South Korea’s financial authorities are preparing a significant expansion of anti-money laundering controls, giving regulators new powers to suspend suspicious bank accounts and widening oversight of cryptoasset transactions, including stablecoins.
According to Chosun Biz, the measures form part of the country’s 2026 AML and countering the financing of terrorism (CFT) key work plan, unveiled by the Financial Intelligence Unit under the Financial Services Commission.
The plan was announced following a meeting of the AML and CFT Policy Advisory Committee held on 5 February. According to the FIU, evolving criminal techniques, particularly those linked to transnational organised crime, have exposed limitations in the current AML framework. The regulator said it intends to strengthen both regulatory tools and supervisory capabilities to better protect consumers and financial institutions.
A central plank of the reforms is the introduction of a mechanism allowing the immediate suspension of accounts suspected of being linked to serious crimes that undermine people’s livelihoods, including drug trafficking, illegal gambling and terrorist financing. To enable this, the FIU plans to amend the Act on Reporting and Using Specified Financial Transaction Information. At present, with limited exceptions such as voice phishing cases, accounts suspected of holding criminal proceeds generally cannot be frozen without a court order.
Initially, account suspensions would only be carried out following a request from investigative agencies. However, the FIU confirmed it is also considering a future framework under which it could request suspensions directly from financial institutions based on its own analysis. To mitigate the risk of unjustified harm to customers, the regulator said it would introduce procedures to ensure suspensions can be lifted promptly where appropriate.
Beyond account freezes, South Korea also plans to broaden the scope of individuals and entities subject to financial transaction restrictions. Currently focused on those linked to terrorism and nuclear proliferation, the designation regime will be extended to include international criminal organisations, supported by a clearer legal basis.
The reforms also mark a tightening of cryptoasset oversight. The so-called travel rule, often described locally as the “coin real-name system”, will be expanded beyond its current threshold of transactions worth 1m won or more on domestic exchanges to include smaller transfers. Stablecoin issuers will, for the first time, be brought formally within the AML regime.
Under the proposed approach, transactions involving stablecoins, including those with personal wallets or overseas operators, will trigger obligations to verify customers or apply other controls based on a risk-based assessment. This reflects growing regulatory concern about the potential misuse of stablecoins for cross-border illicit finance.
An FIU official said, “We will prepare amendment bills for the tasks requiring legal revisions within the first half of the year and submit them to the National Assembly, and we will push ahead quickly with amendments to subordinate statutes, such as enforcement decrees, within the first half.”
The legislative proposals will be submitted to the National Assembly later this year, signalling a faster pace of reform as South Korea looks to reinforce its AML defences ahead of 2026.
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