By Choi Kyong-ae
Korean banks are seeking to close accounts that are being used for financial fraud, the Korea Federation of Banks (KFB) said Tuesday.
"Most financial frauds end with depositing laundered money in such accounts. The perpetrators withdraw money largely from automatic teller machines (ATMs)," Lee Byung-chan, general manager of the Deposit Services and Payment Systems Department at KFB, said.
The financial authorities have been cracking down on these accounts since 2012. Banks are now asking customers to satisfy specific requirements if they want to open up accounts for financial transactions, according to the KFB, the country's banks' lobby.
Starting Wednesday, Korea Exchange Bank (KEB) said Tuesday it is planning to require all customers who open a new bank account at its outlets to declare its purpose. Unlike installment savings accounts, some accounts allow customers to freely deposit or withdraw money at will.
Until now, the bank has asked adolescents, passport-carrying foreigners, and account applicants who have a record of setting up multiple accounts over a short period of time to clarify the purpose of any new account, a KEB spokesman said.
Other commercial banks such as Hana Bank, KB Kookmin Bank, Woori Bank and Shinhan Bank are set to join KEB in efforts to reduce financial crimes.
Those banks are considering asking all customers who open a new account to declare its purpose from February. The Industrial Bank of Korea has already been monitoring accounts of any suspected customers every three months.
The National Agricultural Cooperative Federation (NACF), the farmers-based financial firm was first to take an action last year.
The NACF began its "war against illegal use accounts" in April last year. As a result, the portion of suspected accounts fell to 7.2 percent at the end of 2014 from 21 percent a year earlier, an NACF spokeswoman said.
Meanwhile, the Financial Services Commission said last month the government will strengthen its crackdown on financial frauds using these accounts and ATMs from the first half of 2015.
Korean banks are seeking to close accounts that are being used for financial fraud, the Korea Federation of Banks (KFB) said Tuesday.
"Most financial frauds end with depositing laundered money in such accounts. The perpetrators withdraw money largely from automatic teller machines (ATMs)," Lee Byung-chan, general manager of the Deposit Services and Payment Systems Department at KFB, said.
The financial authorities have been cracking down on these accounts since 2012. Banks are now asking customers to satisfy specific requirements if they want to open up accounts for financial transactions, according to the KFB, the country's banks' lobby.
Starting Wednesday, Korea Exchange Bank (KEB) said Tuesday it is planning to require all customers who open a new bank account at its outlets to declare its purpose. Unlike installment savings accounts, some accounts allow customers to freely deposit or withdraw money at will.
Until now, the bank has asked adolescents, passport-carrying foreigners, and account applicants who have a record of setting up multiple accounts over a short period of time to clarify the purpose of any new account, a KEB spokesman said.
Other commercial banks such as Hana Bank, KB Kookmin Bank, Woori Bank and Shinhan Bank are set to join KEB in efforts to reduce financial crimes.
Those banks are considering asking all customers who open a new account to declare its purpose from February. The Industrial Bank of Korea has already been monitoring accounts of any suspected customers every three months.
The National Agricultural Cooperative Federation (NACF), the farmers-based financial firm was first to take an action last year.
The NACF began its "war against illegal use accounts" in April last year. As a result, the portion of suspected accounts fell to 7.2 percent at the end of 2014 from 21 percent a year earlier, an NACF spokeswoman said.
Meanwhile, the Financial Services Commission said last month the government will strengthen its crackdown on financial frauds using these accounts and ATMs from the first half of 2015.
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