South Korea’s Financial Services Commission (FSC) has repeatedly reduced monetary sanctions proposed by the Financial Supervisory Service (FSS), with 34 of 38 modified cases finalized between January and July 1 resulting in lower penalties. The pattern has fueled criticism that enforcement is inconsistent and vulnerable to litigation risk and public opinion. Recent examples include cuts to fines for Toss Bank, Hana Bank and Cheongun Credit Union, while penalties against 13 securities firms were reduced or waived after the FSC treated the initial period of the Financial Consumer Protection Act as guidance-focused. Courts have also overturned disciplinary actions, and refunds to financial firms exceeded ₩3.5 billion by the end of May. Separately, the FSC plans to submit the government’s Digital Asset Framework Act to the National Assembly this month, including potential limits on major shareholder ownership in virtual asset exchanges. Parliamentary materials show that the FSC has conducted no internal or external legal review, consultation or commissioned research on those ownership restrictions during the past five years. The proposal is considering a 20% ownership cap in principle, with a possible 34% exception for qualifying innovative businesses, although the FSC says the details remain unsettled. Lawmakers and the National Assembly Research Service have raised possible conflicts with constitutional property, business and non-retroactivity protections.