There are concerns that the Financial Intelligence Unit (FIU), which handles tasks such as anti-money laundering (AML) and detecting suspicious transactions, may fall behind in responding to the rapidly evolving digital finance industry, such as virtual assets, as it struggles with a staffing shortage. While the volume of information to process is growing exponentially due to digital finance innovation, the personnel to filter it have actually decreased.
According to the financial authorities on the 10th, the number of suspicious transaction report (STR) filings to the FIU last year was about 1.3 million, up about 20% from the previous year. In contrast, the FIU's headcount reviewing STRs has stayed unchanged at 79 for three years and is down four from 2021 (83). Financial companies or virtual asset businesses must report to the FIU when there is a transaction suspected of money laundering or the flow of illegal funds.
As the financial environment changes rapidly, the number of STR filings is surging. The number of STR filings, which was 24,149 in 2006, reached 329,436 in 2011 and 906,462 in 2023, and as the virtual asset market grew, it surpassed 1 million in 2024. While STR filings jumped about 5,300% over 20 years from 2006 to last year, staffing increased by only 20, pushing the number of cases handled per person over this period from 409 to 16,456, a 40-fold jump. Based on last year's business days, each FIU employee analyzes an average of 67 suspicious transactions per day.
AUSTRAC, Australia's strategic analysis center with a financial market size and environment similar to Korea's, has a total staff of 616 as of 2024, with 452,951 STRs annually, or 735 per person. Germany's FIU had 754 people handling 265,708 cases (an average of 352 per person).
If STRs are not properly managed, it becomes difficult to trace crimes and freeze or confiscate illegal funds. Major crimes such as drugs and terrorism can also spread, and if the Financial Action Task Force (FATF) assigns a low rating, financial credibility can fall internationally, risking a slide into a sanctions evasion country.
The FATF classifies each country's mutual evaluation ratings as ▲ regular follow-up ▲ enhanced follow-up ▲ sanctions list. If classified on the sanctions list, the country is inspected three times a year, and the Korea FIU received the highest rating, "regular follow-up."
However, it was noted that institutional improvements are needed regarding corporate transparency systems and nonfinancial businesses. It said Korea needs to introduce a system to manage beneficial ownership information of corporations and secure personnel to introduce and operate new systems, such as imposing AML obligations on certain nonfinancial businesses. This year, the FIU included in its work plan the suspension of payment on accounts tied to major livelihood crimes such as drugs and terrorism, but there is no plan to add staff even as its scope of work has increased.
The Financial Services Commission sometimes collaborates with the Financial Supervisory Service, but the FIU's work touches on personal property rights and personal data protection, making it difficult to outsource externally.