Kookmin Bank Fined 1.15 Billion KRW for Incomplete Fund Sales and Other Issues

The Securities and Futures Commission Discusses Measures Following Comprehensive Inspection Results
Incomplete Sales of Funds and Trusts and Violation of Recording Obligations
Violation of Website Disclosure Obligations for Investment Solicitation Guidelines

Photo by Mun Ho-nam munonam@

[Asia Economy Reporter Choi Seoyoon] KB Kookmin Bank will be fined approximately 1.15 billion KRW for incomplete sales of funds and other violations.

According to financial authorities on the 11th, the Securities and Futures Commission (SFC) under the Financial Services Commission recently discussed the comprehensive inspection results of Kookmin Bank and decided to impose a fine of 1.1548 billion KRW for ▲ incomplete sales of funds and trusts and violation of recording obligations ▲ violation of the obligation to disclose investment solicitation guidelines on the website.

It was revealed that some branches of Kookmin Bank did not comply with the obligation to confirm explanations, such as obtaining signatures from general investors to confirm their understanding of the contents of financial investment products and the risks involved when selling fund and trust products to general investors.

While selling fund and trust products, they also did not send related product brochures to investors. Some branches of Kookmin Bank violated the recording obligation during the sales process by not recording the sales process when selling products subject to recording, such as equity-linked securities (ELS) trust contracts. The Capital Markets Act stipulates that when entering into trust contracts for derivative-linked securities such as ELS with general investors aged 70 or older, the contract process must be recorded.

Kookmin Bank was also criticized for not disclosing the revised contents despite several changes to the standard investment solicitation guidelines for funds. Previously, last year, the bank was fined 1.1 billion KRW by financial authorities for incomplete sales of ELS trust products and other reasons.