Anti Money Laundry and Financial Intelligence Unit (4)


Anti Money Laundering Measures in Korea (2)

‘Reporting System’

Suspicious Transaction Report  and  Currency Transaction Reporting System  


In the previous post, I introduced you the first measure, ‘Criminalization of Money Laundering’. As well as this strictly defined legal framework, there is ‘Reporting System’ within anti money laundering measures.


Suspicious Transaction Report

Its name is very self-explanatory, as you can guess. This measure lets a financial company report a suspicious transaction to FIU, if there is a reasonable ground to regard the transaction in matter as being suspicious of money laundry. Then, are you ‘an individual’ can report any suspicious transactions? The answer is ‘No’ unless you are working in a financial company. As long as you are an eligible person for reporting, the ‘suspicion’ depends on your subjective judgment.

There is an ever-increasing trend in reporting suspicious transactions. What does this mean? It portrays that people working in financial sector have developed their sense of consciousness. This is about their willingness to pursue transparency in our financial system.

Imagine a case in an opposite direction. If nobody cares about reporting suspicious transaction, ‘whatever’ or ‘who cares’ will be the words spoken in our financial system. In the worst case scenario, there will be someone who keeps looking for a margin of money laundry.

Currency Transaction Reporting System

Despite its good motive, suspicious transaction report is limited by its ‘voluntary’ nature. So, here is another kind of reporting system. Currency Transaction Reporting is an automatic system which reports a transaction over KRW 20 million a day. The details of transaction, on the basis of factual information only, are sent to FIU for further investigation.

So far, this system is considered very effective to cover the limitation of suspicious transaction report. This is acknowledged by FATF and accordingly recommended to other countries.

STR and CTR are complementing each others, seeking the best possible outcome of reporting system. These reporting measures contribute to sorting out suspicious transactions in financial system, giving FIU a clue to more closely monitor and investigate. Anti money laundering measures, in this sense, is understood as not a ‘single-authority system’. Rather, it should be recognized as ‘a value’ sought by each individual appreciating transparency in our society.


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