South Korea’s third-largest cryptocurrency exchange Coinone faces a fine and a partial business suspension over alleged anti-money laundering lapses, local media report.
The Financial Intelligence Unit (FIU) under the Financial Services Commission said Coinone failed to meet AML obligations, including not verifying user identities in roughly 70,000 cases, according to The Korea Times, Chosun and Yonhap News. The FIU also alleged the exchange processed more than 10,000 transactions with 16 foreign exchanges that are not registered with South Korean regulators, despite repeated warnings.
Other alleged violations include marking customer verification as complete when key information was missing and failing to block transactions for users whose verification was incomplete. Cointelegraph said it reached out to Coinone for comment.
This action is the second regulatory move against major South Korean exchanges in recent weeks. In March, Bithumb—the country’s second-largest exchange by trading volume—was fined about $24 million and given a six-month partial suspension for alleged AML failures. That incident followed Bithumb’s erroneous transaction that reportedly sent customers 620,000 Bitcoin (BTC), worth roughly $42 billion at the time, instead of 620,000 Korean won, prompting calls from the Bank of Korea for stricter exchange controls. The central bank has urged lawmakers to consider trading curbs to suspend trading during unusual activity or sudden crypto-price swings.
The FIU reportedly fined Coinone 5.2 billion won (about $3.5 million) and imposed a three-month partial suspension that bars new customers from depositing or withdrawing funds until the suspension ends. Coinone’s CEO Cha Myung-hoon received an official reprimand; the enforcement is administrative rather than criminal. Coinone has 10 days to contest the FIU’s action before the fine and penalties are finalized.
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