PTC Considering Allowing FIU to Trace Domestic Account

The Presidential Transition Committee (PTC) is considering empowering the Financial Intelligence Unit (FIU) a right to request for the financial trade information over suspected domestic transactions for transparent political funds.

If the FIU is empowered, it is expected to have a great impact on exposing and preventing illegal political funds. However, it would not be easy to amend related laws as the majority Grand National Party is opposing severely.

A member of the PTC said, “Some says that it is very restricted for the FIU to watch illegal funds because it is not empowered to have a right to request for the financial transaction information, so we are now considering the empowerment. The political department and the economic department of the PTC plan to amend Money Laundering Prevention Act and criminal profits preventing act under the consultation with the Korea Independent Commission Against Corruption (KICAC).”

The FIU started its activities on November 2001, and it is to be reported about the highly suspected transactions as illegal funds such as criminal funds, political funds and smuggling funds from financial institutions including banks, and to analyze and notice the result to the machinery of law.

However, when the related Money Laundering Prevention Act was passed in the National Assembly, foreign account chase was allowed but domestic account chase was not allowed. With relation to this, the People`s Solidarity for Participatory Democracy (PSPD) filed a legislation petition to the National Assembly for the amendment of Money Laundering Prevention Act which is about mainly allowing domestic account chase. One member of the FIU said, “It is true that we have troubles in finding out the characteristics of illegal transactions in the course of analyzing and reporting the suspected transactions to the machinery of law such as prosecutors, police, custom service, the National Election Commission (NEC) and so on, because we are not allowed to chase the domestic accounts.”

In addition, the PTC is allegedly considering amending the additional clauses of Money Laundering Prevention Act that the FIU informed the NEC about an illegal political fund transaction and the NEC, in turn, informed the related politician so the politicians would have a chance.

But a member of the GDP said, “If a right for domestic accounts chase is given to the FIU which is an affiliated organization of the Ministry of Finance and Economics, it can be used to suppress the opposition party. If the Roh administration go on with this plan, there will be another turbulence in the National Assembly.”

Joong-Hyun Park sanjuck@donga.com