- Controversy over secret to maintaining large unmanned arcades occupying high-rent commercial districts like Gangnam and Seomyeon
- Vulnerability of 'cash business' centered on coins and banknotes… Optimized for 'commingling' criminal funds
- Trade payment disguise method of inflating import prices of 100-won plush toys and remitting to overseas ghost companies
- Market disruption causing soaring commercial rents… Urgent monitoring by authorities required for anomalies in cash sales
Controversy surrounds the secret to maintaining large-scale "claw machine arcades" occupying prime commercial spots in major popular areas nationwide, such as Gangnam, Gwangalli, and Seomyeon. This is due to the abnormal structure where stores with virtually no customers manage to stay open without closing, despite being located in areas with astronomical monthly rents reaching tens of millions of won. Recently, centering around online communities and experts, reasonable suspicions are spreading that the unique "cash payment" structure of these unmanned arcades is being exploited as a perfect laundering route for illegal criminal funds.
The most fatal vulnerability is that claw machine arcades are strictly cash-based businesses. Due to the structure where customers insert coins or banknotes directly into machines to play games, it is virtually impossible for the National Tax Service or financial authorities to track "who spent how much cash." Targeting this flaw, criminal organizations use so-called "cash commingling" methods, pumping millions of won daily of massive black money secured from illegal gambling or drug dealing into empty machines or turning it into fake cash sales on paper. Once normal income taxes are paid at the end of the year, the criminal proceeds are cleanly laundered into "legitimate business income" recognized by the state.
At the same time, the method of "disguising trade payments" to smuggle funds overseas is also being pointed out. After establishing ghost companies in China or Hong Kong, low-quality plush toys worth 100 won in cost to be filled in the machines are imported, while fake contracts inflating the unit price to "10 billion won-class premium dolls per piece" are submitted to customs. Billions of won in funds disguised as normal trade transactions proudly pass through domestic banks and escape overseas, which can then be used to run illegal gambling server operations or turn into foreign capital to purchase domestic real estate.
Because the very purpose of the business is money laundering rather than profit generation, they can afford abnormal rents that ordinary self-employed people cannot even imagine, disrupting commercial district market prices and pushing out honest small business owners.
As of now, it is difficult to externally conclude suspicions for individual businesses, leaving them in a blind spot beyond the surveillance network of financial authorities. The National Assembly and financial supervisory authorities must promptly come up with prevention alternatives. In particular, for unmanned arcades where 100% cash payments occur, it is urgent to establish a monitoring system that automatically detects cases where excessive unissued cash receipt sales occur relative to fixed expenses such as electricity bills. In addition, an amendment to the Anti-Money Laundering Act is required so that the Korea Customs Service and the Korea Financial Intelligence Unit can immediately cross-verify trade remittance cases that excessively exceed import unit prices.