Facing FTC Punishment
The Korea Fair Trade Commission (KFTC) has started a procedure to determine whether to punish Mirae Asset Group based on its conclusion that the group conducted large-scale intra-group transactions with a company owned by its owner family.
The KFTC recently sent a report to the group and the group’s subsidiaries provided illegal support for Mirae Asset Consulting according to the report. The consulting firm has shares in Mirae Asset Capital, Mirae Asset Global Investments, and so on as the de facto holding company of the group and 91.9 percent of the consulting firm is currently owned by the owner’s family. Previously, the KFTC conducted investigations for two years on suspicions that the group’s subsidiaries raised a real estate fund so that the consulting firm can manage lease profits derived from the Four Seasons Hotel Seoul, the Blue Mountain Country Club, etc.
The KFTC’s conclusion means that Mirae Asset Daewoo’s future investment plans can be seriously affected. The securities company with an equity capital of approximately nine trillion won is currently trying to obtain approvals for new business such as short-term financial business and investment management account business.
The group’s official stance is that the consulting firm was in the red in 2015 to 2017 and took no profits from intra-group transactions. An intense legal battle between the group and the KFTC is looming large.