South Korea introduces new telecom-finance anti-fraud regulations: Crypto assets will be included in the scope of reimbursement for victim funds

PANews July 17—According to Etoday, the Financial Services Commission of South Korea has released a draft amendment to the implementing regulations for the “Special Act on the Prevention of Telecommunication and Financial Fraud and the Return of Victim Funds.” The plan is to include phone-scam proceeds transferred into crypto assets within the scope of victim compensation, and to clarify the standards for the return and valuation of crypto assets. The relevant provisions are expected to take effect on October 1.

Under the new rules, if the frozen assets are cryptocurrencies, victims will in principle receive a return based on the type and quantity of the assets. If the scammed assets differ in form from the frozen assets, compensation will be made based on the actual asset form existing at the time the account was frozen. In cases where cash and crypto assets are mixed, the regulator will value the crypto assets based on market prices at the time of the freeze to determine the final compensation amount. The Financial Services Commission of South Korea said that clearly specifying the form of the returned assets and the valuation time point will help achieve faster and fairer compensation in complex cases involving the mingling of funds from multiple victims. It is understood that the public consultation period for the draft amendment will continue until August 24.