'Cha Myung Investment Suspicion' Kang Bangcheon, Former Chairman of Asset Plus, Receives Severe Disciplinary Action Including 'Suspension of Duties'

Financial Services Commission Judges 'Wonderplus', with Major Shareholders, as Proxy Investment

[Asia Economy Reporter Lee Kwang-ho] Former Asset Plus Asset Management Chairman Kang Bang-cheon has received a severe disciplinary action equivalent to a 'suspension from duty' over allegations of nominee investment.

According to financial authorities on the 18th, the Financial Services Commission (FSC) decided at its regular meeting held that day to impose a 6-month suspension from duty and fines on former Chairman Kang. Disciplinary actions for executives are categorized as ▲caution ▲admonition ▲reprimand ▲suspension from duty ▲recommendation for dismissal. If suspended from duty, executives are restricted from employment in the financial sector for the next four years.

Former Chairman Kang is known as a pioneer of 'value investing.' He stepped down from the frontline of management just before allegations of nominee investment surfaced in July last year. The authorities judged that Kang lent his personal funds to Wonderplus, a shared office company where he is a major shareholder, and then operated it under the corporation's name, considering this a form of self-trading (nominee investment).

Kang received a severe disciplinary action equivalent to suspension from duty from the Financial Supervisory Service (FSS) in September last year. After the Securities and Futures Commission's resolution, the final disciplinary action was confirmed by the FSC.

At the FSC regular meeting, the 'Guidelines for Determining Self-Trading by Financial Investment Business Employees Including Nominee Investment' were also passed. The guidelines determine that if three conditions are met ? ▲whether trading funds were provided ▲degree of involvement in trading activities ▲possibility of attributing trading profits and losses ? the employee's actions constitute nominee investment.

When funds are provided to a corporation, if the employee is involved in the trading and the corporation's financial investment product trading profits and losses can be attributed to the employee, it is considered self-trading. Even if the actual profits and losses are not attributed, if the employee holds more than 50% of the corporation's shares or if most investment profits and losses can be attributed to the employee according to agreements or trust contracts, it is considered nominee investment.