20 Cases of Unfair Trade Including 'Ssangyong Motor Eat-and-Run' Reported to Prosecutors via Fast Track... Continued Focus This Year

Financial Services Commission, Financial Supervisory Service, Exchange, and Prosecutors' Office Hold 'Unfair Trade Investigation and Hearing Agency Council'

Financial authorities reported 20 cases of unfair trading to the prosecution last year through the fast track system (Emergency Measures by the Chairman of the Securities and Futures Commission). These included incidents such as the spread of false information related to COVID-19 diagnostic kits, the Edison EV and Ssangyong Motor embezzlement cases, and stock-related cases using KakaoTalk.

On the 28th, the Financial Services Commission (FSC) announced that it held a meeting of the Unfair Trading Investigation and Hearing Agencies Council (Josimhyeop) the previous day with the Financial Supervisory Service (FSS), Korea Exchange (KRX), and the prosecution (Southern District Prosecutors' Office) to discuss current issues related to unfair trading. The fast track system is a mechanism where, if the FSC or FSS is investigating allegations of unfair trading but urgently requires prosecution due to concerns such as the suspect fleeing or evidence destruction, the Chairman of the Securities and Futures Commission can notify the prosecution directly after consultation with related agencies.

The financial authorities plan to ensure that the 'joint investigation' by the FSC and FSS becomes the 'standard for investigations.' During this Josimhyeop meeting, they reviewed the progress of joint investigation cases and agreed to complete the investigations as soon as possible. They also plan to actively select additional joint investigation cases and specify roles and procedures between agencies as needed. Following discussions in December last year, the FSC and FSS are currently conducting joint investigations on two cases. Cooperation between the Korea Exchange, which handles hearings for unfair trading cases, and the financial authorities responsible for investigations will also be strengthened.

An FSC official stated, "Various sanctions such as restrictions on capital market transactions for unfair trading actors and limitations on the appointment of executives in listed companies must be introduced promptly." The official added, "We will diligently prepare for the revision of subordinate laws and practical arrangements related to the 'introduction of surcharge sanctions for unfair trading in the capital market,' which has passed the Political Affairs Committee's bill subcommittee." An FSS official said, "To effectively respond to increasingly sophisticated and organized unfair trading in the capital market, we will further strengthen inter-agency cooperation and focus investigative resources on major cases where investor damage is likely to spread."