South Korean Police to Establish Teams to Combat Money Laundering and Trace Criminal Proceeds

South Korean police are bolstering their investigative framework to pursue criminal proceeds from offenses like voice phishing and illegal private lending, with a new focus on preventing money laundering and concealment. The National Police Agency's National Investigation Headquarters announced an "Advanced Plan for Criminal Proceeds Tracing Investigation System" on Tuesday.

The plan includes establishing a dedicated investigation team to trace the flow of funds before they are laundered or hidden. This initiative aims to help victims recover financial losses and fundamentally dismantle criminal ecosystems by severing their financial lifelines.

Starting in the latter half of this year, police will divide the criminal proceeds investigation teams in Seoul, Gyeonggi Nambu, and Busan police agencies into "Criminal Proceeds Preservation Teams" and "Fund Tracing Investigation Teams." The existing teams will focus on identifying criminal proceeds and obtaining court orders for seizure or preservation before indictment. The new fund tracing teams will handle investigations into money laundering offenses and cases involving specific financial transaction information provided by the Financial Intelligence Unit (FIU).

Police intend to expand the fund tracing investigation teams to Incheon, Gyeonggi Bukbu, and Gyeongnam police agencies in the first half of next year, eventually extending the system to all provincial police agencies. This expansion is driven by increasingly sophisticated methods of money laundering and concealment. The police plan to link these "fund freezing" measures with fund tracing investigations to block criminal proceeds from escaping through alternative channels.

To strengthen capabilities at the police station level, "Criminal Proceeds Preservation Officers" will be assigned to seven police stations, including Gangnam, Songpa, Suseo, and Gangdong in Seoul, Dongnae and Busanjin in Busan, and Suwon Gwonseon in Gyeonggi Nambu, starting in the second half of this year. These officers will possess relevant expertise, such as accounting certifications or master's degrees in police administration, to support local investigators in fund tracing and preservation efforts.

Police have seen a significant increase in criminal proceeds preservation achievements since the establishment of dedicated teams in September 2019. Preservation cases rose from 96 (70.2 billion won) in 2019 to 3,400 (850 billion won) last year, a roughly 35-fold increase. Major crime types included illegal gambling (1,133 cases), drug offenses and others (1,035 cases), specific fraud offenses (690 cases), and sex trafficking solicitation (342 cases). Police also plan to enhance collaboration with financial authorities like the FIU and the Financial Supervisory Service.

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We will continuously expand the perspective of police investigations from apprehension and punishment to victim recovery, contributing to the practical relief of victims' damages.