Home News Exchange Months Before Hack, Suspicious Transactions on Exchange CoinRail Were recorded

Months Before Hack, Suspicious Transactions on Exchange CoinRail Were recorded

Korean crypto exchange CoinRail was in the news recently when it reported that some of the coins were missing from its exchange, after a hack. The worst affected was PundiX, but other coins such as Aston and NPER were also affected.

However, it has come to light that they were some suspicious transactions that had taken place, months before the hack. A local publication had said that some banks had identified suspicious transactions at the exchange and stopped providing services to company months before the incident.

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On Monday the local publication Chosun said some banks had caught some instances of money laundering within the exchange. A bank official said, “Several banks that traded with Coinrail found suspicious money-laundering transactions in Coinrail in February, and some banks took steps to stop their fund deposits in April.”

However, the news outlet noted that the banks did not offer any specific reasons behind suspension of services. According to Bitcoin News, South Korea can legally refuse to provide services to crypto exchanges under the Financial Transaction Reporting and Use Act and Virtual Currency Anti-Money Laundering Guideline if they do not use real-name accounts. Although the real name system was implemented in January 2018, the conversion rate has been slow.

The CoinRail incident has come at a time, when conversations around security in cryptocurrency exchanges are at an all-time high. Starting the year on a bad note, exchanges such as CoinCheck and YouBit suffered hacks of varying nature in the first half of the year.

Another local media house in Korea, the Korea Times noted that National Police Agency Cyber Bureau said, “Investigators visited the exchange yesterday to ascertain whether it was an accident or a crime. KISA has been on the scene since the day of the 10th and is analyzing the cause of the incident jointly with the National Police Agency.”

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