Seeking Justice

 

The Capital Market Investigation Unit of the Financial Services Commission (FSC) launched an investigation of 40 alleged abnormal transactions and unfair trade cases. The investigation unit is going to start the process soon, in cooperation with the Financial Supervisory Service (FSS).

The investigation unit was established about six months after President Park Geun-hye told the financial authorities to eradicate stock price manipulation at her first Cabinet meeting in March 2013. At its inception, the unit had 24 members, sent from the Public Prosecutors’ Office, the FSC, the FSS, and the Korea Exchange.

During the past two years, the investigation unit uncovered exclusive information-based stock trading by Samsung Group employees prior to the recent big deal between the Samsung and Hanwha Groups, early provision of information for institutional investors by IR teams of listed companies, pension fund managers’ prior stock purchases with conspirators, public accountants’ stock trading by the use of internal information of auditees, and other possibly illegal activities.

The FSC is planning to crack down harder on unfair trade practices such as stock price manipulation by foreigners and form wide cooperation networks with foreign financial supervisors to this end. In this context, the FSC acceded to the executive committee of the International Organization of Securities Commissions last month.

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