Woori Bank corporation acquitted in first trial on charges of 'aiding and abetting virtual asset currency exchange employee'

Woori Bank corporation acquitted in first trial on charges of 'aiding and abetting virtual asset currency exchange employee'

"Not the beneficiary of profits… accusation of non-fulfillment of verification duty is an excessive interpretation"

Woori Bank corporation, indicted on charges of aiding and abetting an employee who conspired with a virtual asset currency exchange ring to execute large foreign currency remittances, has been acquitted in the first trial.

Im Hye-won, chief judge of the 19th Criminal Division of the Seoul Central District Court, acquitted Woori Bank Co., Ltd., which was indicted on charges of violating the Foreign Exchange Transactions Act, on the 14th.

The prosecution indicted Woori Bank corporation, arguing that it also held responsibility after branch manager A of Woori Bank and others were investigated on charges including violating the Foreign Exchange Transactions Act.

A was sentenced to three years in prison in June 2023 for his involvement in the so-called 'virtual asset currency exchange' crime between 2021 and 2022.

Virtual asset currency exchange refers to the act of receiving virtual assets from a resident abroad, trading them on a domestic exchange, and then remitting the proceeds as foreign currency. Those who execute transactions in Korea receive a certain percentage of commission.

This method involves taking advantage of the so-called 'Kimchi Premium,' where the transaction amount on virtual asset exchanges in Korea is larger than on foreign exchanges, to earn a profit margin.

It was investigated that A, despite knowing that the virtual asset currency exchange ring intended to remit a large amount of foreign currency by submitting false invoices and disguising them as import payments, instructed the responsible employee to make the remittance. The amount remitted by A is reportedly in the range of 1 trillion won.

The prosecution indicted Woori Bank based on the joint penal provision of Article 31 of the Foreign Exchange Transactions Act.

A joint penal provision is a clause that holds the corporation responsible in addition to punishing the individual employee if the employee commits an illegal act.

Specifically, Woori Bank was accused of aiding and abetting A's illegal foreign exchange operations and failing to verify whether the responsible employees fulfilled their statutory duty to report capital transactions of 1 billion won or more to the Bank of Korea.

The prosecution had requested a fine of 100 million won for Woori Bank in the closing arguments.

The court found Woori Bank not guilty of all charges. The reason was that the joint penal provision could not be applied because Woori Bank was not the beneficiary of the profits from the violation.

The court stated that the purpose of the joint penal provision is to punish not only the actual perpetrator of the violation but also the entity that benefits from the act if they fail to comply with the reporting obligation, and thus ruled that "Woori Bank is not subject to the joint penal provision."

Furthermore, regarding the charge of failing to fulfill the duty to verify the responsible employees, the court stated that "judging that 'they did not verify whether it was reported' merely because the employee did not check the supporting documents constitutes an excessive analogical or expansive interpretation of penal statutes, which goes against the principle of legality."

The court ruled that it could not be considered that Woori Bank should have verified the transactions as long as the employees in question believed they were import payments for goods that did not require reporting or permission, and thus processed the remittances.