Money laundering to earn 5 years in prison

Starting in January next year, anyone found to have laundered ill-gotten money will be sentenced to a maximum prison term of five years or up to 30 million won in fine. In addition, when a foreign currency exchange transaction is suspected of being a part of a money-laundering scheme, the banking institution will be required to report the transaction to the new "Financial Information Unit" under the Ministry of Finance and Economy.

That ministry and the Ministry of Justice have decided to punish and confiscate the illicit money found be a part of money-laundering schemes in 35 specific criminal activities in four categories, namely, those arising from organized crime, tax evasion and contraband smuggling, breach of trust or embezzlement by financial institution employee, the kickbacks and other corrupt dealings involving public officials, and illegal massive transfer of foreign currency abroad.

To those found guilty of such crimes, a sentence of a maximum of five years in prison or a maximum fine of 30 million won could be pronounced. Furthermore, anyone who knowingly accepts illicit money also will be punishable with less than three years or less than 20 million won fine.

Those in financial institutions who fail to report suspicious transactions to the FIU could be punishable for up to 5 million won in fine.

"The enactment of the two laws could help curtail the exodus of foreign currency out of the country with the second phase foreign currency liberalization due for next year," the Ministry of Finance and Economy`s head of planning for the FIU Kim Kyu-Boo said. "The mandatory reporting of transactions of large sums of money as demanded by some of the citizens¡¯ organizations will be considered as a mid- to long-term measure."