How to Strengthen South Korea-US Cooperation on Combatting Cyber-enabled Financial Crime (2023)

Flashpoints|Security|East Asia

The U.S. and South Korea each possess unique strengths in combatting cyber-enabled financial crime, but their true joint potential is largely untapped.

How to Strengthen South Korea-US Cooperation on Combatting Cyber-enabled Financial Crime (1)

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This is the first commentary of a three-part series based on key findings derived from a year-long research project investigating ways to enhance South Korea-U.S. cooperation on combating cyber-enabled financial crime. This project is conducted by the Center for a New American Security (CNAS) with the generous support of the Korea Foundation.

Key logistical and structural differences between U.S. and South Korean intelligence and law enforcement agencies restrict enhanced coordination on crucial cybersecurity vulnerabilities.

Although Washington and Seoul have previously cooperated on cyber-enabled financial crime cases, these joint efforts are often only in response to ongoing incidents and not preventative in nature. This significantly reduces their ability to predict and prevent future crimes as information sharing often occurs already after the initial hack and/or illicit cyberactivity has succeeded.

In likely response to rising levels of cyber-enabled financial crime, Washington and Seoul included specific language on creating a joint cyber working group to combat the spread of ransomware and online sexual exploitation in a May 2021 summit between U.S. President Joe Biden and South Korean President Moon Jae-in. However, the document outlining the summit failed to include coordination on issues related to the misuse of cryptocurrency and other financial technology – despite cybercriminals using crypto as a major source of financing for their illicit activity.

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Dating back to roughly 2017, North Korean operatives have continuously employed ransomware to extort cryptocurrency from their victims and South Korea-based child pornography websites also request payments in cryptocurrency to view their illicit content. Including joint research and investigations on the exploitation of cryptocurrency and new financial technology is crucial to strengthening both U.S. and South Korean national security.

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The United States and South Korea each possess unique strengths in combating the rise of cyber-enabled financial crime, but their true joint potential is largely untapped. For the United States, the long reach of its economic sanctions and trade restrictions can stymie the transfer of financial assets and technology needed to conduct, develop, and improve cybercrime operations. For example, in 2021, the U.S. Treasury Department sanctioned several cryptocurrency exchanges and their operators for facilitating transactions related to ransomware attacks and the Commerce Department issued a new rule barring the export and resale of “cyber intrusion software” to China and Russia, two major trading partners of North Korea, without a proper license from the U.S. Bureau of Industry and Security. These actions restrict targets from accessing the U.S. financial system, including transactions conducted in U.S. dollars, as well as their access to key technologies that can help facilitate the spread and use of malicious software.

While South Korea does not enjoy the same level of economic influence and global reach as the United States, Seoul does benefit from a greater overall understanding and exposure to cryptocurrency-related security risks. Compared to the United States, South Korean policymakers, law enforcement, and the general public possess a higher level of understanding around evolving financial technology, like cryptocurrency, and potential risks to national security. For almost a decade, North Korea has used ransomware and other malicious software to extract financial assets from the South Korean government, financial institutions, the private sector, and the average population. As such, South Korean policymakers and law enforcement have years of experience to responding to cyber-enabled financial crime. In contrast, the watershed moment for most average Americans on their awareness of ransomware happened in early May 2021 after the Colonial Pipelines hack.

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On a governmental level, Seoul began to monitor the growth of cryptocurrency and virtual assets starting around 2017 with several incremental legal actions leading to a government restriction on the use of anonymous accounts in cryptocurrency trading. A year later, South Korea passed a law requiring cryptocurrency exchanges to obtain a certificate from the Korea Internet & Security Agency to continue financial operations, leading to a 2021 legislation requiring all virtual asset service provides (VASPs) to register with the Korea Financial Intelligence Unit (KFIU) to operate in South Korea.

In recent years, the United States has ramped up efforts to bring cryptocurrency and other financial technology under stricter financial regulations and legal guidelines. Most recently, Democratic Senator Elizabeth Warren and several colleagues announced a new bill entitled the “Digital Asset Sanctions Compliance Enhancement Act of 2022” to authorize the Treasury Department to sanction non-U.S.-based cryptocurrency exchanges engaging with sanctioned entities and persons. If codified into law, this bill would significantly increase U.S. capability to target illicit cyber-enabled financial activity abroad, such as cryptocurrency exchanges facilitating transactions linked to Russian, North Korean, and other sanctioned actors. Just weeks before, Biden signed an executive order outlining the first U.S. whole-of-government strategy to protect consumers, financial stability, national security, and address climate risks related to the further development of digital assets.

While there is great opportunity in enhancing cooperation between the United States and South Korea, several obstacles may delay rapid developments in the proposed South Korea-U.S. joint cyber working group.

First, new South Korean President-elect Yoon Suk-yeol vowed during his campaign to “deregulate the virtual asset industry” to allegedly promote further growth of the industry, while offering to raise the current crypto tax threshold from around $2,000 to roughly $40,000. Yoon also promised to establish a new government agency to monitor new areas of digital industry, such as cryptocurrency and non-fungible tokens (NFTs), and also allow local initial coin offerings (ICOs), the crypto equivalent to an initial public offering (IPO). This varies significantly from the current U.S. government approach, which recently named the first director of the National Cryptocurrency Enforcement Team to meet “the challenges posed by the criminal misuse of cryptocurrencies and digital assets” in close collaboration with the FBI’s new Virtual Asset Exploitation Unit. As Yoon will assume office in South Korea in May, the future level of executive support in curbing cryptocurrency-backed cybercrime remains unclear.

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Second, there are major structural difference between U.S. and South Korean institutions addressing cyber-enabled financial crime that could limit enhanced coordination. In the U.S. context, typically the FBI and the Department of Justice collaborate on financial crime cases involving ransomware payments and online sexual exploitation, whereas South Korean agencies are typically siloed into tighter perimeters of engagement. For example, while the Korean National Policy Agency (KNPA) is the main domestic law enforcement agency dealing with financial crime, any illicit activity with a nexus to North Korea falls under the jurisdiction of the South Korean National Intelligence Service (NIS). The KNPA and NIS are often described as South Korean counterparts to the U.S. FBI and CIA, but these key structural differences restrict potential information sharing and logistical operations addressing real-time hacks and illicit cyber activity. Understanding these structural differences is key in ensuring that a joint South Korea-U.S. cyber working group utilizes the appropriate government agencies, expertise, and resources to maximize collaborative efforts to combat cyber-enabled financial crime.

Cyber-enabled financial crime will likely continue to rise as the global economy and its consumers become more engaged with cryptocurrency and its growing digital industry. As the United States and South Korea contemplate ways to strengthen their own national defenses against ransomware and other illicit cyber activity, the two countries can work together to cover each other’s deficiencies and expand efforts to include more cyber and crypto-related collaboration within their alliance.


Does South Korea have cyber security? ›

In 2022, to accelerate the promotion of its cybersecurity industry, the Korean government established the “Strategic Plan to Foster Data Protection Industry” . There is a growing number of domestic and U.S. companies providing cybersecurity services in Korea. There are 530 cybersecurity firms registered in Korea.

Who is responsible to protect cyber crime and cyber security? ›

Although the CIO, or CISO, still carries primary responsibility for cybersecurity in 85% of organisations (1), it is the entire organisation and everyone working in the business who holds the secondary responsibility for it. Cyberattacks can be targeted at anyone in the business.

What is the importance of cybercrime investigation to the study of criminology? ›

Like law enforcement agencies, private companies, and organizations conduct investigations in response to a detected or reported cybercrime. The purpose of this investigation is to obtain information about the incident and build a case against the perpetrator (or perpetrators) of the cybercrime (or cybercrimes).

What is the role of a cybercrime investigator? ›

A cybercrime investigator investigates a number of crimes that range from recovering file systems on computers that have been hacked or damaged to investigating crimes against children. In addition, cybercrime investigators also recover data from computers that can be used in prosecuting crimes.

How secure is South Korea? ›

While most of the country is pretty safe, there is one area that comes with trouble. In order to have a non-problematic stay, it's best to avoid this place completely. It's really not hard to guess, but the DMZ, the area between the South and North Korean border is probably the most dangerous place in the country.

Does South Korea restrict Internet access? ›

Internet censorship in South Korea is prevalent, and contains some unique elements such as the blocking of pro-North Korea websites, and to a lesser extent, Japanese websites, which led to it being categorized as "pervasive" in the conflict/security area by OpenNet Initiative.

Who is responsible to resolve cyber crime related issues? ›

States/UTs are primarily responsible for prevention, detection, investigation and prosecution of crimes through their law enforcement machinery. The Law Enforcement Agencies take legal action as per provisions of law against the cyber crime offenders.

What type of prevention can be implemented to reduce or stop security threats? ›

Firewalls are another essential tool in defending networks against security threats. A firewall can help prevent unauthorized access to a network by blocking incoming traffic from untrusted sources. Additionally, firewalls can be configured to allow only certain types of traffic, such as web traffic or email.

How can you protect your organization from cyber crime? ›

CYBERCRIME: 9 Steps to Safeguard Your Organizations Data and Technology
  1. Install a firewall – and ensure that it is properly configured to ensure that no potential points of entry are left undefended.
  2. Install – and regularly update- advanced antivirus protection. ...
  3. Maintain advanced antispam protections.
17 May 2022

What is the conclusion of cybercrime? ›

To conclude, we can say that Cyber Crime is a dangerous offense to someone's privacy or any material. Also, we can avoid Cyber Crime by following some basic logical things and using our common sense. Above all, Cyber Crime is a violation of not only law but of human rights too.

What is the main reason for cyber crime? ›

Protect Your Storage Data: Stealing Data or information is the main cause of any form of hacking. Therefore, it is important that you encrypt all your data to prevent any and every kind of attack on your system or database, as this could prove fatal to your privacy.

What are the benefits of crime prevention? ›

Crime prevention can reduce the long term costs associated with the criminal justice system and the costs of crime, both economic and social, and can achieve a significant return on investment in terms of savings in justice, welfare, health care, and the protection of social and human capital.

What tools are being used created to fight cybercrimes? ›

Some important tool use for preventing cyber attack are 1)Kali Linux, 2) Ophcrack, 3) EnCase, 4) SafeBack, 5) Data Dumber. Kali Linux is an open-source software that is maintained and funded by Offensive Security.

What are the most important responsibilities of an investigator at the crime scene? ›

A Criminal Investigator will usually perform the following duties: Collect, analyze and preserve evidence. Investigate complex criminal activities or local, federal or state law violations. Direct crime-scene investigators or other law enforcement personnel at crimes scenes.

What is methodology of cyber crime investigation? ›


Why is crime so low in South Korea? ›

Due to the large police and military presence after the Korean War, the expansion of home-grown organized crime was slowed, almost giving South Korea immunity against international criminal organizations.

Why is Korea the safest country? ›

South Korea is one of the safest countries in Asia; gun crime is largely non-existent and it often feels as if there are surveillance cameras on every corner. A side effect of this safety, they say, is that it is all too easy for law enforcers to take things easy.

Is South Korea friendly with us? ›

South Korea has a long military alliance with the United States, aiding the U.S. in every war since the Vietnam War, and most recently during the Iraq War.

Why South Korea has the best internet? ›

However, there are multiple reasons why South Korea's broadband is successful, such as, “Government planning, healthy competition, urban population density, private-sector growth, and Korean culture”, which have made it difficult for other countries to mimic their success.

Why South Korea has the fastest Internet connection? ›

Population density isn't much fun if you're claustrophobic, but it makes fast internet a lot easier to get. With the high proportion of Koreans living in urban-area apartments, spreading connections between them is more like stitching a quilt than building a road.

Does South Korea have the best internet? ›

The United Arab Emirates (UAE) and South Korea boast some of the fastest average mobile internet connections in the world, with each of these countries registering average speeds in excess of 200 Mbps as of October 2021.

What is the best solution for cybercrime? ›

Using anti-virus or a comprehensive internet security solution like Kaspersky Total Security is a smart way to protect your system from attacks. Anti-virus software allows you to scan, detect and remove threats before they become a problem.

Why is it important to prevent cybercrime? ›

It may protect you from viruses, malware, ransomware, data theft or loss due to hacking, and so on.

What is a solution to prevent cyber security? ›

Prevention is the key to reducing the risk of a data breach. By investing in cybersecurity software, using a VPN, and being aware of common attack methods, individuals and organizations can deter hackers and keep their data private.

What are four ways you can prevent cyber attacks? ›

5 easy tips to protect yourself - today
  • Check if you've already been involved in a data breach. Visit and change those passwords for any accounts that it suggests may have been compromised.
  • Check the strength of your passwords. ...
  • Avoid these passwords. ...
  • Trust no one (on emails) ...
  • Secure your device.

How does the government prevent cyber attacks? ›

Current tools include the National Cybersecurity Protection System, of which the EINSTEIN cyber intrusion detection system is a key component; the National Cybersecurity and Communications Integration Center, which serves as the nation's principal hub for organizing cyber response efforts; and a 2010 landmark agreement ...

What is the importance of cyber security in our society? ›

Cybersecurity is important because it protects all categories of data from theft and damage. This includes sensitive data, personally identifiable information (PII), protected health information (PHI), personal information, intellectual property, data, and governmental and industry information systems.

What are the top 10 cyber crime prevention tips we discussed? ›

  • Top 10 cyber crime prevention tips. Use strong passwords. ...
  • Use strong passwords. Different passwords for different accounts- combine letters, numbers, and special characters.
  • Secure your computer. ...
  • Be social media savvy. ...
  • Secure Mobile devices. ...
  • Install the latest OS updates. ...
  • Protect your data. ...
  • Secure your wi-fi network.

Why is cyber security important essay? ›

In today's world, cybersecurity is very important because of some security threats and cyber-attacks. For data protection, many companies develop software. This software protects the data. Cybersecurity is important because not only it helps to secure information but also our system from virus attack.

What are the effects of cyber crime on society? ›

The ill effects of cybercrimes often lead to extreme financial ruin and reputation loss to both businesses and individuals. Moreover, the repercussions of cybercrimes can affect society in numerous ways. Cybercrime can take numerous forms, be it online scams for petty thefts or serious threats like terrorism.

What are the two main strategies of crime prevention? ›

Current crime prevention practices focus largely on targeting the risk factors that contribute to crime through social development approaches. The emphasis is on early intervention and focuses on combining two main types of crime prevention: situational and social development.

What is the most common way to prevent a crime? ›

Here are some of the ways that could help your neighborhood to fight crime.
  1. Install CCTV. ...
  2. Improve Street Lighting. ...
  3. Engage in Community Watch. ...
  4. Keep in Mind the Impact of Illegal Drugs. ...
  5. Observe Gun Safety. ...
  6. Educate Everyone. ...
  7. Strengthen the Community.
9 Jun 2017

What is the main strategy of crime control? ›

The most viable crime control strategy is that of integration techniques requiring adaptation by deviants combined with the reconstruction strategy emphasizing social change.

What are the 5 best methods used for cyber security? ›

10 steps to an effective approach to cyber security
  • Risk management regime. ...
  • Secure configuration. ...
  • Network security. ...
  • Managing user privileges. ...
  • User education and awareness. ...
  • Incident management. ...
  • Malware prevention. ...
  • Monitoring.

What are the 3 key prevention measures of cyber attacks? ›

Essential cyber security measures
  • Use strong passwords. Strong passwords are vital to good online security. ...
  • Control access to data and systems. ...
  • Put up a firewall. ...
  • Use security software. ...
  • Update programs and systems regularly. ...
  • Monitor for intrusion. ...
  • Raise awareness.

What are the five most important forms of cybercrime? ›

The top 5 types of cybercrime are:
  • Phishing.
  • Ransomware.
  • Malware.
  • Identity theft.
  • Online scams.
2 Mar 2021

What are the six important skills abilities that an investigator must have? ›

Here's a list of 12 investigative skills that can help professionals perform their tasks effectively:
  • Curiosity. ...
  • Problem-solving. ...
  • Research skills. ...
  • Evidence collection. ...
  • Interviewing. ...
  • Report writing. ...
  • Critical thinking. ...
  • Honesty.

What types of skills are important for someone to be successful as a crime scene investigator? ›

good attention to detail and keen observational skills for finding and recording evidence. strong analytical skills and an inquisitive approach. the ability to work in a team and to coordinate with other professionals. the patience to be able to correctly catalogue and store evidence.

What are 4 duties that should be performed at a crime scene? ›

Sign and date evidence container/maintain chain of custody. Appropriately collect and package evidence to maximize evidence integrity. Maintain evidence log. Use appropriate protective equipment (gloves) and methods when dealing with potentially infective evidence (blood).

What are the six measures to avoid cyber crime? ›

Protect yourself against Cybercrime with the help of Following Ways.
  • Ensure your software is up-to-date. ...
  • Don't fall for pop-ups. ...
  • Secure your internet network with a strong encryption password and a VPN. ...
  • Manage your social media settings. ...
  • Protect yourself from identity threats. ...
  • Educate your children about internet risks.

What are the different methods of cyber defense? ›

Network Security

These solutions include data and access controls such as Data Loss Prevention (DLP), IAM (Identity Access Management), NAC (Network Access Control), and NGFW (Next-Generation Firewall) application controls to enforce safe web use policies.

What are the most common method of cybercrime? ›

5 most common types of cybercrimes:
  • Phishing scams: ...
  • Internet fraud: ...
  • Online intellectual property infringements: ...
  • Identity theft: ...
  • Online harassment and cyberstalking:

Is South Korea No 1 in technology? ›

South Korea is the world's leading manufacturer of smartphones and televisions. Germany has the highest concentration of high-tech companies in sectors such as the automotive industry and electronics. Finland stands out due to its high patent activity, its productivity and its investment in higher education.

Does South Korea have high technology? ›

South Korea is also among the world's most technologically advanced and digitally connected countries; it has the third most broadband Internet users among the OECD countries and is a global leader in electronics, digital displays, semiconductor devices, and mobile phones.

What is rank of South Korea in technology? ›

8 this year, the science ministry said Wednesday, citing the International Institute for Management Development (IMD). According to the ministry, South Korea climbed four notches from last year's 12th spot in the 2022 IMD World Digital Competitiveness Ranking report.

Is South Korea good for technology? ›

South Korea is now at a critical inflection point. The country has succeeded in becoming an economic powerhouse with a technological edge, especially through big conglomerations manufacturing software and hardware.

Why is South Korea the most innovative country? ›

Bloomberg Innovation Index credits Seoul's increased patent activity, strong performance in R&D and manufacturing. South Korea has topped the global list of the 60 most innovative countries, the Bloomberg Innovation Index, released Wednesday.

What made South Korea so successful? ›

South Korea's education system and the establishment of a motivated and educated populace is largely responsible for spurring the country's high technology boom and economic development. South Korea began to adapt an export-oriented economic strategy to fuel its economy.

Why is South Korea successful? ›

Innovation and technology are the key factors that have underpinned South Korean export competitiveness and fueled the country's remarkable economic rise over the past decades.

Is South Korea a developed country or developing country? ›

Korea is one of the few countries that has successfully transformed itself from a low-income to a high-income economy and a global leader in innovation and technology. The Korea office works with Korean partner institutions to help developing countries learn from Korea's experience and expertise.

What is the biggest technology company in South Korea? ›

Samsung Electronics

Why does South Korea have fast internet? ›

However, there are multiple reasons why South Korea's broadband is successful, such as, “Government planning, healthy competition, urban population density, private-sector growth, and Korean culture”, which have made it difficult for other countries to mimic their success.

What is South Korea's competitive advantage? ›

South Korea's comparative advantage lies in technology and design, not in resource-intensive heavy-manufacturing industries, which will inevitably lose market share to competitors in China.

What is South Korea known for in the world? ›

Since the 21st century, South Korea has been renowned for its globally influential pop culture, particularly in music (K-pop), TV dramas (K-dramas) and cinema, a phenomenon referred to as the Korean wave.

Is South Korea a powerful country? ›

Korea is ranked sixth in this year's global power rankings by the magazine U.S. News & World Report. An American magazine has ranked Korea as the sixth most powerful country in the world.

What does South Korea value the most? ›

The Korean values of obligation towards others, respect for family, elders and authority, loyalty, honour, and filial piety are all part of its Confucian.

What does South Korea economy rely on? ›

South Korea's largest industries are electronics, automobiles, telecommunications, shipbuilding, chemicals, and steel.

What is unique about South Korea? ›

South Korea is the world leader in internet connectivity. Approximately 92% of the country's population are internet users, and they boast the world's fastest average connection speed. Taekwondo is the national sport of South Korea. It's believed to have been invented approximately 2,000 years ago.


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