Close Watch over Illegal Election Funds

Financial Intelligence Unit (FIU) is to watch closely for illegal flow of electoral funds as local elections in June and the presidential race in December draw near.

In cases of violation, the National Election Committee (NEC) and the prosecution are to be informed.

FIU is an organization established last November under the Ministry of Finance and Economy to guard against illegal fund transactions and criminal money laundering.

FIU authority said on the 18th, "Democrats will hold a party convention to select their presidential candidate in April, and mass political funds are expected to be raised around that time. We will carefully watch for any kind of illegal fund."

The authority also added that "Reported illegal cases involving over 50 million won or 10,000 dollars of money laundering will be carefully examined and then informed to the NEC and the prosecution." He explained, "There is a possibility that violators will lower the transaction amount below 50 million won to avoid suspicion." Guidelines to restrict such methods were published and distributed to financial institution offices. The guidelines include:

-Frequent transactions involving large amount of money without specific reasons

-Changing large amounts of unauthenticated cash into checks, or changing large amounts or variety of checks into cash

-Cases of termination of accounts after frequent large amount transactions in short time, or large amount of money being sent to many, immediately after receiving.

-Sales of large amount or variety of bonds to bearer

-Sudden redemption of long- term delayed loans

Chan-Sun Hong hcs@donga.com