A pan-government body to respond to illegal foreign exchange transactions such as hwanchigi (informal remittances), offshore asset flight, and offshore tax evasion has been launched.
The Ministry of Finance and Economy said on the 15th that, together with the National Intelligence Service, National Tax Service, Korea Customs Service, Bank of Korea, and Financial Supervisory Service, it launched the Illegal Foreign Exchange Transaction Response Team to strictly respond to acts that disrupt the foreign exchange market and economic order. The move comes from the view that there are limits to responses by individual agencies as methods of illegal foreign exchange transactions become increasingly complex and sophisticated.
The response team was formed to remove silos between agencies and pool their expertise. It is focusing on jointly tracking and cracking down on illegal cross-border capital flows.
In particular, it plans to target for intensive crackdowns hwanchigi, in which payments are exchanged without going through an authorized foreign exchange bank, offshore asset flight through manipulation of export and import prices and false filings, and offshore tax evasion and money laundering by exploiting foreign exchange transaction procedures.
A government official said, "We expect to eliminate blind spots in enforcement by mutually sharing investigative information and analytical capabilities held by each agency."