South Korea fast-tracks law to freeze suspected drug and gambling accounts

South Korea’s financial authorities are accelerating plans to revise the Act on Reporting and Using Specified Financial Transaction Information, with the Financial Intelligence Unit (FIU) targeting a September submission to the National Assembly.

As reported by Chosun Biz, the FIU under the Financial Services Commission formed a task force earlier this year to lead a comprehensive overhaul of the country’s anti-money laundering framework. The revision has been identified as the FIU’s top priority for 2026, with internal discussions expected to conclude in the first half of the year before the draft amendment is formally introduced when the regular National Assembly session convenes on September 1.

At the center of the proposed reform is the creation of a system that would allow authorities to swiftly suspend financial accounts suspected of being used for major livelihood-related crimes, including narcotics trafficking, illegal gambling and terrorism financing. Currently, freezing an account typically requires a court order except in limited circumstances, a process that can delay enforcement action.

Under the proposed amendment, the FIU would be empowered to directly suspend suspicious accounts upon request from investigative agencies, enabling faster intervention to prevent further criminal activity. Earlier this year, the agency also revised its typologies for suspicious transactions to better reflect evolving money laundering techniques tied to transnational and livelihood-infringing crimes.

In parallel, the FIU is collecting feedback from the virtual asset sector on amendments to the enforcement decree of the same act, which is scheduled to take effect on Aug. 20. Officials recently met with representatives from the country’s five major cryptocurrency exchanges and the Digital Asset eXchange Alliance.

While some industry participants have expressed concern that the changes could strengthen the FIU’s sanctioning powers, the agency has stated that the enforcement decree revisions are not intended to pressure the sector. The final shape of the legislative overhaul is expected to draw close scrutiny from both financial institutions and digital asset operators in the coming months.