A South Korean court has overturned the Financial Intelligence Unit’s (FIU) three-month partial business suspension of Dunamu, operator of the Upbit crypto exchange, local reports say.
Yonhap News Agency reported that the Seoul Administrative Court sided with Dunamu in its suit against the FIU, annulling the sanction tied to alleged anti-money-laundering (AML) shortcomings. The court found that while rules were clear for transactions above 1 million won (about $675), guidance for smaller transfers lacked sufficient specificity, weakening the legal basis for enforcement in this case.
The ruling limits the FIU’s ability to impose major AML penalties on exchanges where compliance standards are not explicitly defined in practice. It also resolves a dispute that began after the FIU issued the sanction in February 2025; the penalty had been paused by the court while Dunamu’s challenge proceeded.
Court cites lack of guidance in Dunamu decision
The court rejected the FIU’s assertion that Dunamu failed to take adequate measures, noting the regulator had not provided precise guidance on required actions. It found Dunamu had implemented its own measures and that, even if those measures appear inadequate in hindsight, it is difficult to conclude the company acted with intent or gross negligence—undermining the grounds for the sanction.
FIU sanction triggered a legal challenge from Dunamu
On Feb. 25, 2025, the FIU imposed a three-month partial suspension restricting new Upbit users from transferring digital assets after an on-site inspection that reportedly found Dunamu facilitated transactions with unregistered overseas virtual asset service providers (VASPs) and fell short on customer due diligence. The FIU has said it identified over 600,000 suspected Know Your Customer violations during a review of Upbit’s exchange license.
Dunamu filed a lawsuit and sought an injunction to halt enforcement soon after the penalty was announced, submitting the case on Feb. 28, 2025. On March 27, 2025, the court granted an injunction allowing Upbit to continue onboarding new users while the matter was under review.