Preparation of an Independent AML External Audit Report for a Virtual Asset Exchange

Client Information

Corporate / Client

 

Case Details

A domestic virtual asset exchange (“Company A”) engaged Decent Law Firm to conduct an independent external audit of its Anti-Money Laundering (AML) framework, as required under the Act on Reporting and Using Specified Financial Transaction Information (the “Special Financial Transactions Act”) and Article 15 of the Operational Regulations on Anti-Money Laundering and Counter-Terrorist Financing (the “Operational Regulations”).

Under the Special Financial Transactions Act, Virtual Asset Service Providers (VASPs) are obligated to establish and maintain an AML system and to undergo an independent review at least once annually.

Amid increasing regulatory scrutiny from supervisory authorities, Company A sought an objective assessment of whether its AML framework complied with current legal and regulatory standards and to proactively identify potential compliance risks. For this purpose, the company retained Decent Law Firm’s Digital Asset & Virtual Asset Practice Group.

Decent’s Digital Asset Practice Group conducted the audit in accordance with the FATF Recommendations, relevant FIU notices, and the Operational Regulations.

Using a proprietary AML audit checklist developed in line with these standards, we performed a comprehensive review through document analysis, interviews with responsible personnel, system demonstrations, and sampling-based testing. A formal external audit report was then prepared and delivered.


1. Evaluation Across Nine Operational Areas
- We assessed both the design and the actual implementation of AML controls across nine core areas, including:
- Governance
- KYC (Know Your Customer)
- EDD (Enhanced Due Diligence)
- WLF (Watch List Filtering)
- Travel Rule compliance
- STR (Suspicious Transaction Reporting)
- and other key AML control functions

Each area was evaluated and assigned a graded Level rating reflecting its operational maturity.


2. Identification of Vulnerabilities and Practical Recommendations
For each identified deficiency, we categorized risks by priority and provided concrete, actionable recommendations that could be immediately implemented within the client’s operational structure.


3. Board-Ready External Audit Report
We calculated an overall AML operational maturity rating and prepared a comprehensive external audit report suitable for submission to the Board of Directors.