Korbit Receives $1.88 Million Fine Over Anti-Money Laundering Failures

• Regulators identified over 22,000 AML-related violations, including improper identity checks and transaction controls.
• The FIU issued an institutional warning to Korbit and specific warnings to senior executives following a late-2024 inspection.

The South Korean Crypto Exchange, Korbit, has been imposed with a fine of 1.88 million dollars, which is about 2.73 billion won, and has received an institutional warning by South Korea’s Financial Intelligence Unit (FIU).

​This strong decision comes after the comprehensive review that happened in late 2024, which found  that the Korbit exchange failed to follow the anti-money laundering assessments, including improper customer checks, and transactions with unregistered overseas entities.

Major Violations Identified During Regulatory Inspection

According to the press release from South Korea’s Virtual Asset Inspection Division, there were three major violations committed by the Korbit exchange. 

First, it was confirmed with 22,000 violations, which include incomplete identity verification records, failed to update customer information after required resubmissions, and these themselves contributed around 12,800 cases.

​Then, without checking the customer details properly, the operator allowed several transactions that constituted around 9,100 cases.

​Secondly,  Korbit was found to have conducted 19 transactions with three overseas virtual asset service providers that were not registered with the Korean authorities. Thirdly, the FIU also identified 655 cases in which Korbit supported new transaction types, such as non-fungible tokens (NFTs), without conducting mandatory risk assessments prior.

​Following this review, the authority resolved this issue with an institutional caution against Korbit and imposed penalties, as the company’s chief executive and the Anti Money Laundering (AML) reporting officer received a formal warning. 

Mirae Asset’s Acquisition Talks Add Context to Enforcement Action

The Korea Times reported on Monday that Mirae Asset, a financial group, basically a traditional finance in South Korea, was considering acquiring the Korbit exchange, as it stands as the third largest with $8,969,358 24-hour volume out of six South Korea crypto exchanges tracked by Coingecko.  The timing of the talks, which began before the sanctions were announced, provides regulatory background to the potential deal.

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