Police crack down on currency shops

By Lee Kyung-min

People walk past a currency shop in Yeongdeungpo, Seoul, Wednesday. / Yonhap

Police have launched a crackdown on currency exchange shops that mainly deal with Chinese customers based on tip-offs that some are aiding illegal money transactions for China-based voice-phishing rings.

Police suspect that the rings have used the shops with the intent of evading monitoring.

Only those registered with the Bank of Korea (BOK) are allowed to provide overseas transfer services. However, police suspect that the rings are using some small unauthorized shops.

Police said the unauthorized shops charge commission in exchange for transferring money to China, which is an offense that carries a prison sentence of up to three years or a fine of up to 300 million won ($277,000).

Police said the ring likely used the unauthorized shops because they are easier to manage than transactions via the BOK registration center, which requires identity clearance and mandatory reports to the National Tax Service.

The crackdown came after they detected such illegal transfers made near areas with high populations of Chinese such as Yeongdeungpo, Guro, both in Seoul, and Ansan, Gyeonggi Province.

Many Chinese frequent the centers because of the low commissions, which are about 10,000 won ($9), police said. Financial institutions charge up to 100,000 won depending on the amount of the transfer.

“Those engaged in the alleged scheme should face due punishment,” a police officer said.

“So far, our focus was to apprehend the ring members who worked here at the direction of people back in China,” he added.

Fundamentally blocking the possibility of ill-gotten gains is crucial to breaking up the crime rings, according to the officer.

“The China-based rings will have nothing if they cannot have a channel through which they can access the money,” he said.

Police will question the center owners on whether they had prior knowledge that the funds transferred were connected to crime.

Those confirmed to have known will face charges.

“The crime rings swindling the public and funneling the money through illegal means is a crime we plan to root out completely,” the officer said.