Disguised crypto exchange bank accounts exposed by South Korean regulator

South Korea’s Financial Services Commission revealed today that it had discovered 14 bank accounts used by virtual asset exchanges that had been registered in names that were not those of the exchanges themselves.

Fast facts

• It is not legal for crypto exchange bank accounts held under other names to accept customers’ funds on behalf of exchanges. Some accounts had been opened under the name of an executive or under a the name of an affiliate.

• Virtual asset exchanges that have not acquired real-name account contracts with banks are prohibited from processing withdrawals and deposits of Korean won on their platforms. That has led some to set up separate corporate bank accounts into which users deposit money in exchange for crypto.

• The FSC discovered the bogus accounts after examining a total of 94 accounts run by 79 virtual asset exchanges, according to the press release.

• Financial authorities say the investigation of bank accounts operated by exchanges will continue until Sept. 24, after which all exchanges will be required to have real-name bank accounts in order to continue operating.