Watchdog urges foreign financial firms to step up efforts against money laundering

The Financial Supervisory Service on Thursday urged foreign financial companies operating here for more efforts in anti-money laundering actions amid increasing cross-border transactions and the rapid advancement of financial technology services.

Underlining the country’s upper hand in information and communication technology and innovation, the watchdog also encouraged companies from advanced countries to actively share their financial technologies and operating know-how.

The 10th annual session of FSS Speaks, a forum seeking to promote communication between the FSS and foreign financial players here, was held Thursday at Lotte Hotel in downtown Seoul.

Attending the event this year were some 360 officials and executives from financial companies, global credit rating agencies and embassies, according to the FSS.
 

“Encouraging signs of economic recovery can be seen both at home and abroad, but nevertheless, we must not lose sight of possible financial market volatility or other adverse effects,” said Yoo Kwang-yeol, first senior deputy governor, in his keynote speech.

The senior official is serving as acting governor, following the abrupt resignation of Gov. Choe Heung-sik earlier this week amid an ongoing recruitment scandal.

“The Korean financial industry faces the challenge of restoring the fundamental values of finance and thereby rebuilding trust in the market.” Yoo said, criticizing the financial circle for being carried away by protectionism and short-term gains.

Addressing foreign financial companies, the FSS official called for renewed efforts to create synergy by sharing their business expertise in the Korean market.

“Korea has a solid foundation where your innovative financial technologies may firmly take root,” Yoo said, citing the country’s top-tier ranking in the Bloomberg Innovation Index and ICT Development Index.

In terms of internal control and risk management, the FSS official placed a focus on preventing money laundering practices, which have been increasing on the back of active cross-border transactions and rapid growth of the fintech sector.

Attendees from the financial and diplomatic circles acknowledged the FSS’ message, with some highlighting their demands for further deregulation.

“Good regulations are at the heart of an industry’s success,” said Simon Smith, British ambassador in Seoul.

“We could innovate all we like but if the industry were to lose the public’s trust, it would just not be on the right track.”

Marc Knapper, charge d’affaires ad interim of the US Embassy in Seoul, vowed to promote Korea-US cooperation in lifting regulations.

“The US is eager to encourage Korea to fully open its market and adopt global standards,” the US official said.

By Bae Hyun-jung (tellme@heraldcorp.com)