The value of assets that South Korean courts have barred criminals from disposing of, a step taken to allow later confiscation of crime proceeds, has fallen sharply. The decline has raised concerns that the overhaul of the investigative system — the abolition of the Prosecution Service and the launch of the Serious Crimes Investigation Agency — is weakening the ability to trace and recover criminal profits at a time when methods of hiding them are growing more sophisticated.
Courts approved freezing orders worth a combined 1.02 trillion won ($710 million) on requests from prosecutors and police in the first seven months of this year, according to Justice Ministry data obtained by Rep. Kang Myung-koo of the People Power Party, a member of the National Assembly's Public Administration and Security Committee, on the 25th. The total fell 63% to 3.34 trillion won last year from 9.03 trillion won in 2024, and is expected to decline again this year.
The drop in value has outpaced the decline in the number of orders. Courts issued 4,301 freezing orders last year, down 4% from 4,478 in 2024, with 2,698 recorded through July this year. The average value per order, however, plunged about 61% to 780 million won last year from roughly 2 billion won in 2024.
A steep fall in freezing orders sought by prosecutors appears to account for much of the change. Orders requested directly by prosecutors totaled 79 billion won in the first seven months of this year, or 7.75% of the total, while those requested by police came to 941.6 billion won, or 92.25%. Prosecutors accounted for about 7.17 trillion won, or 79.31% of the total, in 2024, but that figure fell to 1.85 trillion won, or 55.35%, last year. As the transfer of investigative powers from prosecutors to police has accelerated, responsibility for freezing crime proceeds has shifted largely to the police.
The pattern has also shifted by type of crime. Freezing orders in certain fraud cases, which require tracing complex money flows, exceeded 800 billion won in 2024 but came to less than 250 billion won last year. Orders for pre-indictment confiscation in such cases totaled only about 60 billion won through August this year. Freezing orders rose, by contrast, in some other crimes including gambling, obstruction of business and distribution of obscene material.
Freezing crime proceeds is a procedure that locks up illegally obtained assets in advance so that offenders cannot sell or conceal them. Without prompt action, assets can be transferred to accounts held under others' names or moved abroad, making actual recovery difficult.
Offenders are increasingly going beyond parking money in borrowed-name accounts. Recent cases have involved converting proceeds into cryptocurrency through gift certificate transactions before moving the funds overseas, as well as spreading holdings across real estate, stocks and expensive artwork registered to a spouse in a sham divorce or to companies set up under borrowed names. With dedicated money-laundering networks also taking part, investigators need considerable tracing capacity to identify where the proceeds ultimately end up and to freeze the assets.
The question is whether existing tracing capacity can be maintained as the investigative system is overhauled, following the transfer of investigative powers and now the abolition of the Prosecution Service. Freezing work once divided between prosecutors and police is being reorganized around the police, but the hiring of specialists and the building of cooperation frameworks between agencies have not kept pace, critics say.
Tracing proceeds and freezing assets in the early stages of an investigation is especially important in voice phishing, drug and organized fraud cases. Delays in transferring cases and conducting legal reviews between the police, the Serious Crimes Investigation Agency and the Public Prosecution Office, however, can buy offenders time to move money out. There are also concerns that gaps could open up in investigations if prosecutors' expertise in financial investigations and their tracing experience are not properly passed on to the new agency.
Experts called for more staff dedicated to tracing crime proceeds and for faster freezing procedures across agencies. Han Sang-hee, a professor at Konkuk University Law School, said a framework should be built to let police trace crime proceeds quickly. "A structure needs to be established in which the National Office of Investigation, the Serious Crimes Investigation Agency, the Public Prosecution Office and the Justice Ministry can consult together," the professor said.
Others said recovering crime proceeds should be treated as a core measure of how well victims are protected. Lee Kun-soo, a professor of police administration at Baekseok University, said recovery should not be seen as a secondary task separate from arresting offenders. "It should be understood as protecting victims — preventing further losses and leading to compensation for damage," the professor said.
