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FSS establishes internal control measure as abnormal foreign remittances amount to $7.2 bn

NSP NEWS AGENCY, By Eun-young Huh and Soo-in Kang, 2023-06-13 13:30 ENX7
#foreign remittance #FSS

(Seoul=NSP NEWS) = It's been reported that the abnormal foreign currency remittances identified by the Financial Supervisory Service (FSS)'s general inspection on banks since June last year reached US$7.22 billion (about KRW 9.38 trillion). Accordingly, the FSS established the so-called 'three-step defense,' an internal control system involving bank branches and foreign currency and internal control divisions at the headquarter to monitor recurrences of those suspicious remittance cases.

According to the report by the FSS on 7th, the general inspection implemented since last June revealed suspicious foreign currency transactions in the false disguise of trade worth of US$7.22 billion in total. In the course of the inspection, the FSS also found some vulnerabilities of the interal control such as poor inspection on proof documents and failing in detecting repeated abnormal transactions.

Through the 'three-step defense' system, the FSS will first standardize the list of items that bank branches must check in proof documents ahead of implementing foreign remittance transactions. The first step will help raise awareness on the effectiveness of banks' obligation to check the proofs, thereby preventing companies to be subject to unnecessary administrative execution.


The second action of the system will have standardized monitoring criteria and monitoring system be established to strengthen the foreign currency division's the frequent monitoring on abnormal foreign currency transactions.

At the last step, the internal control division's responsiblities and roles will be clearly defined and the follow-up inspection system such as bank branches' money recycling will be set up.

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