South Korea Cracks Down on $101.7M Crypto Fraud Ring in Major Bust

TLDR

• South Korean Customs Service dismantled a $101.7M crypto money laundering operation.
• Three Chinese nationals were arrested for violating the Foreign Exchange Transactions Act.
• The criminals used WeChat Pay and Alipay to receive illicit deposits from customers.
• Crypto assets were transferred to South Korea and converted into Korean won.
• Authorities uncovered the laundering of funds under the guise of legitimate expenses.

South Korean authorities have dismantled a criminal operation involving nearly 150 billion won ($101.7 million) in cryptocurrency through money laundering. The Korea Customs Service (KCS) announced on Monday that three Chinese nationals were arrested for violating the Foreign Exchange Transactions Act. The criminals used crypto accounts to facilitate the laundering of funds from September 2021 to June 2025.

Criminals Exploit Crypto Accounts for Laundering Scheme

The KCS revealed that the suspects operated by exploiting both domestic and international cryptocurrency accounts. According to the customs office, these individuals received funds through WeChat Pay and Alipay from customers who sought to remain anonymous.

Once the cryptocurrencies were obtained, they were transferred to digital wallets in South Korea. The criminals then converted the assets into Korean won, continuing the laundering process under various pretenses. They disguised their transactions as legitimate expenses, including trade fees and study abroad funds, while also citing cosmetic surgery fees for foreign nationals.

Increased Crypto Transaction Monitoring in South Korea

The South Korean government has been pushing to solidify its position as a global cryptocurrency hub. However, the recent bust highlights the growing efforts to secure crypto transactions against illegal activities. This crackdown comes as part of the country’s broader initiative to tighten oversight on cryptocurrency transfers below 1 million won, effectively closing a loophole that allowed users to bypass identity verification.

In 2025, South Korea flagged a record 36,684 suspicious crypto transactions, surpassing the total from the previous two years. The KCS and local Virtual Asset Service Providers (VASPs) reported an increase in suspicious activity, further highlighting the importance of crypto transaction monitoring in the nation.

The post South Korea Cracks Down on $101.7M Crypto Fraud Ring in Major Bust appeared first on CoinCentral.