Suspicious Transaction Reporting and STR Processes
This domain tests the end-to-end suspicious transaction reporting process: detection, internal escalation, decision-making, filing with KoFIU, confidentiality, and recordkeeping. Korea has no minimum won threshold for an STR; the trigger is reasonable suspicion.
Core rules
- Staff who detect unusual activity should escalate promptly under internal procedures to the AML compliance or reporting officer.
- The reporting officer assesses whether there is suspicion of money laundering, terrorist financing, or a related predicate offence.
- Covered institutions file STRs with KoFIU through the designated system and keep supporting documentation.
- Tipping-off is prohibited: do not tell the customer, or unauthorized third parties, that a report was or may be filed.
- An STR does not automatically require account closure, but the institution should reassess the relationship and consider exit, enhanced monitoring, or further reports.
Worked example
A customer receives repeated small deposits from unrelated individuals, then wires most of the balance to a newly formed company abroad. The pattern does not fit the customer's stated salary and the customer gives evasive answers. The relationship manager should not warn the customer or split the transactions. They should document the facts, escalate to the reporting officer, and file an STR if suspicion is reasonable.
Traps
An STR is not a currency transaction report and does not need to meet the KRW 10 million cash threshold. Suspicion does not require proof of a crime. Do not delay a report to complete a full investigation; file and continue reviewing.