South Korea’s Financial Services Commission has released a draft amendment to the enforcement decree of the Special Act on the Prevention of Telecommunications Financial Fraud and Refund of Fraud Losses. The proposal would bring phone scam proceeds that were converted into crypto assets within the scope of victim compensation, while also setting out standards for the return and valuation of crypto holdings.
Under the draft, if frozen assets are cryptocurrencies, victims would in principle receive restitution based on the type and quantity of the assets. If the form of the defrauded assets differs from the form of the frozen assets, compensation would be made according to the actual asset form present in the account at the time it was frozen. In cases involving a mix of cash and crypto, regulators would value the crypto portion using market prices at the time of the freeze to determine the final compensation amount.
The public comment period on the amendment will run through Aug. 24, and the revised rules are expected to take effect on Oct. 1.
South Korea’s Financial Services Commission has published a draft amendment to the enforcement decree of the Special Act on the Prevention of Telecommunications Financial Fraud and Refund of Fraud Losses. The proposal would include phone scam funds transferred into crypto assets within the scope of victim compensation and would also define standards for returning and valuing crypto assets. The revised rules are expected to take effect on Oct. 1.
Under the draft, if frozen assets are cryptocurrencies, victims would in principle be compensated according to the type and quantity of those assets. If the form of the defrauded assets differs from the form of the frozen assets, compensation would be based on the actual form of assets held in the account at the time it was frozen.
For cases involving a mix of cash and crypto assets, regulators would value the crypto portion based on market prices at the time of the freeze to determine the final compensation amount. Public comments on the draft amendment will be accepted through Aug. 24.
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