South Korea’s top money-laundering watchdog has slapped crypto exchange Korbit with a fine worth about ₩2.73 billion, or roughly $1.90 million, after finding widespread lapses in its compliance controls.
According to regulator statements and multiple news reports, the move follows an on-site inspection that uncovered thousands of rule breaches and several risky transfers abroad.
Regulatory Findings And Scope Of The Inspection
The Financial Intelligence Unit said inspectors found nearly 22,000 breaches related to AML and KYC rules. The FIU said the inspection, carried out from October 16 to 29, 2024, exposed serious gaps in how Korbit verified customer identities and handled transactions.
Reports have disclosed that the exchange allowed some customers to trade before full verification was completed and accepted unclear or incomplete identity documents in many cases.
The regulator also flagged 19 overseas transfers involving three unregistered foreign virtual asset service providers, a practice that is restricted under Korean law.
The FIU highlighted the failure to carry out required risk checks for certain services, including some nonfungible token activities. In total, 655 cases were cited where mandatory risk assessments were not completed, according to the findings.
Corporate responsibility measures were taken as well: the CEO received a formal caution and the compliance officer was reprimanded. An institutional warning was issued alongside the monetary penalty.
Transaction Failures And Enforcement Details
The inspection report described multiple instances where trading or withdrawals proceeded despite incomplete KYC steps. Such lapses raise the chance that illicit funds could move through the platform without timely detection.
The FIU’s action is part of a broader push by South Korean authorities to tighten oversight of exchanges and bring them into closer alignment with international anti-money-laundering standards.
Market sources indicate Korbit has been in discussions with Mirae Asset Group about a potential deal, with the exchange’s valuation reported at around ₩140 billion — roughly $97–$98 million.
That interest comes even as regulators step up scrutiny, showing that traditional finance remains curious about crypto assets despite compliance headaches.
What The Penalty Means For The IndustryOther exchanges have also faced tougher checks in recent years as authorities press platforms to shore up controls.
The Korbit case is likely to prompt more internal reviews across the sector and could speed up changes in procedures, staffing and technology meant to prevent repeat failures. Some measures will be public, while others may be handled behind closed doors.
Korbit declined to comment directly to some outlets, while the FIU confirmed the sanction on December 31, 2025. The exchange will now need to demonstrate fixes or face possible further action.
Featured image from Pexels, chart from TradingView
