Foreign exchange transactions at Woori, Shinhan banks under investigation by prosecution

A customer visits a bank in Seoul on March 31. [NEWS1]

The prosecution launched an investigation into suspicious foreign exchange transactions reported by Shinhan and Woori Bank last month, local media reported Monday.

The Financial Supervisory Service (FSS) relayed relevant data to the prosecution, which just started reviewing the data, a prosecution official told Yonhap.

The investigation is looking into some 1.3 trillion won ($9.9 billion) worth of suspicious foreign exchange transactions made at Shinhan Bank and another 800 billion won of similar transactions made at Woori Bank over the past year. Both banks reported the "suspicious transactions" to the FSS last month.

The Woori Bank transactions were all made at one branch. Shinhan did not specify which of their branches were involved.

Neither the FSS nor the banks specified what was meant by “suspicious transaction,” but the banks said the transactions' frequency and volume were taken into consideration.

“We reported the transactions as suspicious considering the frequency and volume of the traded amount” at certain branches, said Bae Hyun-ill, a spokesperson for Woori Bank.

“The reporting of such suspicious foreign exchange transactions is unusual,” said Park Kwon-seo, a spokesperson for Shinhan Bank.

Following the reports, the FSS ordered other commercial banks to internally look into any suspicious foreign exchange transactions made in early July.

The banks were ordered to submit any findings by July 29, said Park Sung-soo, a spokesperson for Hana Bank.

Woori Bank has cited no relation to crypto investments as of yet.

“I’m aware that there are a lot of concerns about strange foreign exchange transactions and the various problems that may accompany them,” FSS Gov. Lee Bok-hyun said following a press event held in central Seoul on July 5.

Lee added that the FSS created a new foreign exchange review team following the reports to “intensively inspect the case in the short term.”

BY JIN MIN-JI [jin.minji@joongang.co.kr]