Prosecutors have uncovered for the first time an electronic payment service provider (PG) that is suspected of assisting a criminal organization in laundering illegal funds amounting to nearly 2 trillion won by providing more than 4,000 virtual accounts.
The Eastern District Prosecutors’ Office's voice phishing crime joint investigation team reported on the 3rd that they have booked four individuals, including the actual representative of the PG company, Mr. A, on charges including violation of the Electronic Financial Transactions Act, with two of those being detained and two others indicted without detention. A member of the task force noted, "This is the first investigation case against a PG company that directly supplied virtual accounts to a criminal organization."
They are suspected of providing 4,565 virtual accounts to organizations involved in voice phishing and illegal gambling site operations from October 2023 for a year and transferring funds deposited into those virtual accounts to the accounts of criminal organizations. According to prosecutors, Mr. A reportedly recruited an illegal gambling wholesaler as the 'executive director' and recruited criminal organizations as affiliates to provide virtual accounts for money laundering. The proceeds from crimes transferred by them amount to approximately 1.8 trillion won, and they are said to have pocketed about 3.2 billion won as a commission.
PG companies typically enter into operation agency contracts with banks to supply virtual accounts to affiliates. The supplied virtual accounts are temporary deposit account numbers solely used for deposits connected to the PG company's master account, primarily used for utility payments and online shopping. Virtual accounts can be created essentially indefinitely, and even if a victim reports, only the specific virtual account in question is suspended, not the master account.
The task force plans to seize all criminal proceeds through confiscation measures and continue investigations into the organizations that used the virtual accounts.