Former Major Securities Firm PB Sentenced to 8 Years for Manipulating Investment Returns Over 11 Years to Receive 73.4 Billion KRW

A former private banker (PB) at a major securities firm, who deceived investors by pretending to generate fund profits and received approximately 73.4 billion KRW over more than 10 years, was sentenced to a medium prison term in the first trial.

The Seoul Southern District Court Criminal Division 14 (Presiding Judge Jang Seong-hoon) on the 3rd sentenced A (57), a former PB at Mirae Asset Securities who was arrested and indicted on charges including violation of the Capital Markets and Financial Investment Business Act, to 8 years in prison and a fine of 500 million KRW. A confiscation order of 335 million KRW was also issued.

The court stated, "Despite the extremely egregious nature of the crime, including investing the money received from high-net-worth victims under the pretext of fund investment into stocks and forging and using stock order forms, the defendant is making some claims that are difficult to accept." It continued, "The defendant exploited the trust of the victims and committed the crime intelligently and boldly over more than 10 years. The damage suffered by the victims and Mirae Asset Securities is enormous, and it appears there is no possibility of recovering the losses." However, the court explained the sentencing reasoning by saying, "Except for the embezzlement charge related to work duties, there is no confirmation that the defendant personally gained profits, and considering that the benefits obtained from the crime are not large compared to the victims' losses."

A is accused of inducing 17 victims to subscribe to a tax-exempt fund guaranteeing a 10% return from December 2011 to January 2022 by deception and providing false balance statements to conceal investment losses, thereby receiving a total of 73.4 billion KRW. The victims are related by family ties, and considering the current balances and profits, the total estimated loss is 11.1 billion KRW.

A is also charged with forging withdrawal request forms to transfer and withdraw 23 billion KRW from the victims' accounts from December 2016 to January 2022 to hide investment losses, then paying false profits or secretly trading stocks. Additional charges include forging stock order forms in the victims' names and arbitrarily trading stocks 7,105 times, causing commission losses worth approximately 3.7 billion KRW, and withdrawing 335 million KRW arbitrarily from some victims' accounts for personal use.