Four individuals, including the operator of a stock cafe, were prosecuted for deceiving investors by selling unlisted stocks with low chances of going public at ten times their actual transaction price, as if they were about to be listed.
On the 26th, the Financial Investigation Division 1 of the Seoul Southern District Prosecutors' Office (Chief Prosecutor Kim Suhong) announced that they had indicted without detention four people, including Bok (41), the operator of the stock cafe and stock broadcast who defrauded about 30 victims of a total of 10.2 billion KRW, and A (42), the CEO of an unlisted company, on charges of violating the Capital Markets Act and fraud. Bok was known by the nickname "Securities Emperor" in internet communities.
According to the prosecution, Bok conspired with A, the CEO of the chicken franchise 'Chungman Chicken,' to profit by selling Chungman Chicken stocks at high prices to members of the stock cafe he operated and viewers of his stock broadcasts. In July 2016, Bok falsely claimed on his securities broadcast that Chungman Chicken's operating company was about to be listed and that the stock was trading at a high price. Around that time, he sold Chungman Chicken stocks to about 300 victims at 26,000 KRW per share, defrauding a total of 10.2 billion KRW.
At that time, the par value of Chungman Chicken's stock, whose operating company was in deficit, was only 100 KRW per share, and in the over-the-counter market from 2019 to 2021, the stock traded at around 2,500 KRW per share. This means the stocks were sold at prices more than 260 times the par value and over 10 times the actual transaction price. Moreover, no transactions occurred after January 2021.
During the securities broadcast, Bok falsely stated that Chungman Chicken's operating company was about to proceed with the listing process soon, that the number of franchise stores had exceeded 200, and that traders were selling stocks at 31,000 KRW per share.
However, in reality, Chungman Chicken's operating company was in deficit and did not meet the KOSDAQ listing requirements, so it had not even applied for listing to date. At that time, the number of franchise stores was only 101, and there was no record of stocks trading above the 26,000 KRW per share price that victims had paid.
A prosecution official stated, "We plan to strictly punish unfair practices involving unlisted stocks through stock cafes, securities broadcasts, and leading rooms."
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