The Financial Services Commission in South Korea reported that 110 tons of gold is traded in the country each year. Out of the total gold trade, about 70 tons of gold bullion is traded on the black market.
The value of the black market gold in South Korea is estimated to be about $3 Billion (3.3 Trillion South Korean Won). The Government of South Korea loses an estimated $280 Million in tax revenue from the gold smuggling.
In 2013, criminal justice programs across the country seized 360 kilograms of gold as it was being smuggled into the country. The number of busts conducted by Customs officers doubled in 2013 when compared to 2012.
The Korea Precious Metals Distributors’ Associated states that buying smuggling gold on the black market can be up to 7 percent cheaper than buying gold through proper channels.
Financial and tax experts in South Korea state that many people buy gold bars in order to hide income.
Source: Heesu Lee, “Korea Exchange Seeks a Cut of $3 Billion Illegal Gold Trade,” Blooomberg Businessweek, March 24, 2014.