South Korea blocks deceased-person transactions across finance

The Financial Services Commission will activate the Rapid Financial Transaction Blocking System for Transactions in the Names of Deceased Persons on 11 September, blocking transactions in a deceased person’s name from the day after death registration.

The system will cover all financial sectors and automatically route death-registration information through the Korea Credit Information Services and financial companies. Family members will not need to submit a separate blocking request, the FSC said in a 7 September press release.

The FSC announced the system with the Ministry of the Interior and Safety, the Financial Supervisory Service and the Korea Credit Information Services. Its stated purpose is to prevent fraudulent transactions using the names of deceased persons.

The Ministry of the Interior and Safety will provide deceased-person information once daily, compared with once a month previously. Financial companies must check the information in real time during face-to-face and remote transactions and block the transaction immediately when the counterparty is confirmed to have died.

The coverage extends beyond banks to insurers, card companies, securities companies, savings banks and mutual finance institutions. The FSC said the system will cover 4,890 financial companies and all financial transactions, subject to specified exceptions.

Deposits remain possible while other transactions are blocked

Deposits into a deceased person’s account will remain permitted. The FSC said this avoids requiring heirs to pursue a separate debt-collection process for money owed to the deceased person.

Financial companies may also permit exceptional withdrawals for urgent and unavoidable expenses, such as medical treatment and funeral costs. The family must submit supporting documents, including a certificate of family relations, and the funds may be transferred directly to the relevant hospital, nursing home or funeral facility.

The notice distinguishes these exceptions from the wider transaction block. It does not change the separate inheritance process or establish a new procedure for identifying or distributing estate assets. The FSC directed surviving family members to use lawful inheritance procedures and referred to the Financial Supervisory Service’s Financial Transaction Inquiry Service for Heirs and the Ministry of the Interior and Safety’s Safe Inheritance One-Stop Service for asset checks.

The system may also stop automatic transfers from accounts held in the deceased person’s name. The FSC advised that payment arrangements for public utilities and insurance premiums should be changed to avoid missed payments.

Financial companies must electronically record their handling of deceased-person information and related transaction histories. The Korea Credit Information Services will amend its credit-information management rules to prohibit use of the information for purposes other than transaction blocking or disclosure to third parties.

The Financial Supervisory Service plans to work with the relevant institutions to inspect how financial companies manage deceased-person information and operate their internal controls. The notice does not identify a separate filing deadline or a scheduled review date for those inspections.

The system takes effect on 11 September, with daily information delivery and transaction-level checks from the day after death registration. The notice identifies no further scheduled official event; the relevant records are the system’s implementation and the Financial Supervisory Service’s continuing inspections.