South Korea’s financial watchdog has imposed a massive fine of 35.2 billion won ($24.3 million) on Dunamu, the operator of the country’s largest cryptocurrency exchange, Upbit, for violating customer identification regulations.
According to the Financial Intelligence Unit (FIU) under the Financial Services Commission, Dunamu failed to properly verify user identities in around 5.3 million cases. The company also neglected to report 15 suspicious transactions, among other compliance breaches.
Investigators found that Dunamu had accepted photocopies and re-photographed images of users’ identification documents instead of requiring original files, making it difficult to confirm the users’ true identities. Some documents even had blank or inaccurate address fields, the FIU added.
The watchdog further revealed that Dunamu allowed transactions to proceed in 3.3 million cases where users had not completed the required verification process.
In response, Dunamu stated that it had taken protective measures for investors and pledged to prevent similar violations in the future. The FIU has given the company 10 days to submit its opinion before finalizing the fine.
In a related development, KT Corp., South Korea’s second-largest telecom provider, was found to have hidden malware infections on its servers following a major cyberattack. A government-led investigation revealed that between March and July 2024, KT discovered that 43 servers were infected with BPFDoor malware, which allows hackers to bypass firewalls and maintain long-term access to compromised systems.
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Despite detecting the breach, KT reportedly failed to inform authorities and attempted to resolve the issue internally. The same malware was also linked to an earlier hacking case involving SK Telecom, another major South Korean telecom firm.
