Kangwon Land Fined US$2.39M For Breaching AML Laws

Kangwon Land Inc., the company behind the Kangwon Land Casino, the single resort venue in South Korea where is possible for local citizens to enter and gamble, has been imposed an overall fine of KRW3.23 billion, which is approximately US$2.39 million, for 182 cases of violations of anti-money laundering (AML) laws.

Violations occurred during the past year:

The aforementioned violations occurred during the last year, but were only publicly announced on October 24 specifically at the audit hearing that was held for the aforementioned company, which is a public entity, and was organized at the South Korea’s National Assembly. In addition, South Korea’s Financial Intelligence Unit (FIU), a body within the Financial Services Commission whose main objective is to prevent non-legal fund flows and money laundering, reported breaches.

Payment of fine:

Kangwon Land Inc. patched up its fine during June of 2023, officially paying KRW2.58 billion, a reduction of roughly 20% to indicate the fact that it had decided not to contest the findings of the Financial Intelligence Unit. On a related note, in compilation with the information provided at the aforementioned National Assembly hearing, the company “faced 181 cases of violation concerning customer due diligence.” Speaking on the matter, Kangwon supposedly failed to verify the information about the identity of the clients in connection with jackpot wins or casino-chip sales. But that’s not all; because there is also 1 case including supposedly false information in connection with client’s registration.

Additional cases about customer due diligence violations involve claims of, according to GGRAsia:

•  “failing to verify the source of transaction funds in relation to 23 customers
•  randomly changing information related to 16 customers
• deletion of information on 158 customers
•  violation of a mandatory requirement to hold relevant records on customers for a period of five years”

Lowest rating:

Moreover, also throughout June 2023, the said firm also received what is allegedly its “lowest-ever grade, a D,” in association with the government’s yearly “public organisation performance evaluation.” The main reasons for this are:

• lack of amenities to attract customers at Kangwon Land resort
•  lack of efficiency in association to labor costs
• claims of bullying and sexual harassment in the workplace
• supposed corruption related to staff recruitment

About:

51% of Kangwon Land Corporation is owned by four regional autonomous governments, Gangwon-do Development Corporation established by the provincial office of Gangwon-do, and Korea Mine Reclamation Corporation under the supervision of the Ministry of Knowledge Economy. So the casino has a government level credit rating, and practices fair and transparent management in development projects and business operation.