Kangwon Land fined US$2.39m for AML breaches

Kangwon Land has been fined for 182 anti-money laundering breaches.

South Korea.- Kangwon Land has been subjected to a financial penalty of KRW3.23bn (US$2.39m) for 182 breaches of anti-money laundering (AML) rules in 2022. It did not dispute the findings and settled its penalty in June by paying KRW2.58bn, gaining a 20 per cent discount on the original penalty.

The details were disclosed during an audit hearing at the National Assembly of South Korea earlier this week. The Financial Intelligence Unit (FIU) of South Korea, an agency under the purview of the Financial Services Commission, had found that Kangwon Land violated customer due diligence in 181 cases by failing to verify customer identity information in connection with casino chip sales or jackpot wins. A further case involved false information on the registration of a customer.

In the cases of customer due diligence violations, the company failed to verify the source of transaction funds from 23 customers while 16 customers’ information was altered “randomly”, 158 customers’ information was deleted and a requirement to retain data for five years was violated.

Kangwon Land received a D grade in June this year as part of the government’s annual public organisation performance evaluation. It was alleged that Kangwon Land lacked “customer-attracting content,” had inefficiency in labour costs, sexual harassment in the workplace, and allegations of corruption in hiring.

The casino operator has posted a net profit of KRW89.2bn (US$68.5m) for the second quarter of the year, up 138.3 per cent in year-on-year terms but down 12 per cent when compared to the previous quarter.

The company’s sales fell 7.5 per cent quarter-on-quarter to KRW331.1bn (US$253.5m), of which KRW294.3bn (US$225.3m) was attributed to gaming revenue. Gross gaming revenue was also down 7.5 per cent quarter-on-quarter at KRW331.1bn (US$253.5m).