South Korean police recover 26.37 billion won for phishing victims

South Korean police and cryptocurrency exchanges have successfully returned approximately 26.37 billion won to 1,137 victims of voice phishing. The recovery follows a three-year investigation by the Seoul Metropolitan Police Agency's Metropolitan Investigation Unit, which tracked the flow of funds through 1,050 frozen electronic wallets across five major domestic cryptocurrency exchanges.

Previously, a legal loophole in the Telecommunications Fraud Damage Refund Act prevented cryptocurrency exchanges from sharing victim information or returning frozen funds, as the law only applied to traditional financial institutions like banks. This left significant amounts of criminal proceeds stuck in digital wallets.

Starting October 1, an amended version of the law will include cryptocurrency exchanges under the definition of financial institutions. This change will allow exchanges to share information with banks, freeze suspicious accounts, and refund victims even if the stolen funds have been converted into virtual assets.

While the recent operation recovered about 69% of identified phishing losses held in crypto accounts, police noted that approximately 30.9% remains difficult to recover. Authorities are also investigating 130 individuals suspected of illegally disposing of roughly 3.04 billion won in crime proceeds.