Lee Chan-jin, the chairman of the Financial Supervisory Service (FSS) in South Korea, has recently expressed the opinion that the organization needs to be restructured into an independent national agency akin to the United States Securities and Exchange Commission (SEC) or Japan's Financial Services Agency. This call for an overhaul comes in the wake of discussions around the reform of the financial supervision system that had been prominently raised with the commencement of the Yoon Seok-yeol administration but has since stalled. Amid controversies regarding the designation of the FSS as a public institution, the proposition to establish it as an independent regulatory body has gained traction.

During a recent seminar organized by the Financial Services Commission, Lee remarked on the necessity for a ‘Korean version of the SEC’ to improve the investigation and sanctioning processes related to unfair trading. According to him, the establishment of such an agency would bolster the expertise and speed of investigations and sanctions, which are seen as inadequate in light of increasingly sophisticated financial crimes and the lengthy procedures for addressing them. He highlighted the pressing issue of time delays in investigations, which can span over three years involving various regulatory and judicial steps, contrasting it unfavorably with practices in the US and the UK.

The established regulatory bodies in the US and the UK, including the SEC and FCA, wield significant investigative and prosecutorial powers, which include the authority to freeze assets and conduct thorough market oversight including in the cryptocurrency exchanges. These powers are important for protecting investors and ensuring fair market practices. With the rise in complex financial crimes facilitated by technological advancements, Lee's proposal underscores the urgent need for reform in South Korea's financial regulatory landscape to better safeguard investors and maintain market integrity.