Financial Supervisory Service Sanctions Investment Advisory Firms Violating Major Shareholder Credit Extensions

[Asia Economy Reporter Lee Jung-yoon] Investment advisory firms that violated credit extension restrictions to special related parties of major shareholders have been caught by financial authorities.

According to the financial sector on the 1st, the Financial Supervisory Service recently took measures including a caution to the institution, a fine of 266 million KRW, a penalty of 62 million KRW, and warnings to two executives against Tomato Investment Advisory for allegations of violating credit extension restrictions to major shareholders.

Tomato Investment Advisory lent money to special related parties of major shareholders from 2017 to 2019, and in 2019, it was found that the money was lent without prior resolution by the board of directors.

Evergreen Investment Advisory also received a caution to the institution, a fine of 235 million KRW, and a warning to one executive for similar violations. It was confirmed that from 2016 to 2021, credit extension limits were exceeded in lending credit to special related parties.

Additionally, Tenbase Invest was caught conducting unauthorized investment brokerage related to public offering subscriptions and received an institutional warning along with a dismissal request for one executive.