400 Million Invested in Stocks, Suddenly Halted... "Sorry, Bro" They Killed My Brother [Tears of Small Shareholders]①

The Always Bright Brother,
Falling into Darkness after Stock Trading Suspension
Reality Sinking into Quicksand...
Small Shareholders Left Helpless
After the Brother, Even the Mother...
A Family Collapsed by the Capital Market

Editor's Note402.5 billion KRW. This is the amount of embezzlement and breach of trust disclosed by 29 listed companies last year, during which the government’s value-up project was underway to enhance corporate value. Small shareholders are neither protected nor included when crimes occur within companies. Even if executives commit embezzlement and breach of trust, leading to suspension of stock trading and delisting, small shareholders cannot monitor these actions in advance nor hold anyone accountable. They have no choice but to bear the losses and wait. Ahead of the regular March shareholder meeting season of listed companies, we focus on the tears of small shareholders excluded from the domestic stock market, which continuously calls for corporate value enhancement.

I first met Mr. Ji (50, male) last August on a hot day. Meeting him at a cafe located in Yeongtong-gu, Suwon, he appeared neat in attire, wore a faint smile shaped by long years of working life, and looked every bit a typical office worker.

"Oh, I should have bought the coffee."

When I handed him a prepared iced Americano, Mr. Ji repeatedly bowed his head in thanks. Sitting down, we exchanged questions and answers about our ages, places of residence, and work life, until a brief silence fell. Wiping water flowing from his coffee cup, Mr. Ji spoke with a calm expression.

"If it had been a year ago, I would have been crying and unable to continue the conversation."

Ji-mo's 45-year-old younger brother committed suicide in September 2023 at Geondalsan in Hwaseong-si, Gyeonggi Province. He experienced emotional distress after the KOSPI-listed company EID, in which he had invested about 400 million won, was suspended from trading. A photo of Ji while hiking during his lifetime. / Photo by Ji's family

Mr. Ji recalled September 5, 2023. At that time, he was having lunch near his company in Suwon when a loud phone call came through. "Are you Mr. Ji OO?" At first, he thought it was a voice phishing scam and hung up.

But the phone rang again immediately. A sense of foreboding overwhelmed him. On the second call, he heard radio chatter in the background. He sensed something serious was happening. The caller was the police. They delivered unbelievable news: Mr. Ji’s younger brother, Mr. A (45, male), had committed suicide at Geondalsan in Hwaseong, Gyeonggi Province.

Mr. Ji’s brother worked at a research institute of an automobile company located in Changwon, Gyeongnam. They were very close, with the brother often coming up to Suwon on weekends to hang out with him. The brother frequently went camping at Geondalsan while in Suwon. "I never imagined the mountain he loved so much would be his final place." Mr. Ji sighed deeply.

In Mr. Ji’s memory, his brother was always bright and kind. But in May 2023, after experiencing a certain incident, he began to sink into deep darkness. "There are shameless people in the world, but there are also good people. And good people sometimes face unbearable situations. My brother was one of those who suffered that."

The Always Bright Brother, Falling into Darkness after Stock Trading Suspension

Ewha Group affiliates Ewha Electric, EID, and E-Tron were suspended from trading by the Korea Exchange on May 10, 2023, due to allegations of embezzlement and breach of trust by current and former executives. The day after the suspension, Ewha Electric disclosed that the embezzlement amount was approximately 830 million KRW.

After Ewha Electric’s disclosure, the Korea Exchange lifted the trading suspension on Ewha Group affiliates on May 12, 2023. However, at around 2:22 PM the same day, trading was suspended again. It turned out that the embezzlement amount by executives including former Ewha Group Chairman Kim Young-jun exceeded 10 billion KRW. Over two trading days, small shareholders who had invested in Ewha Group fell from heaven to hell.

One of those shareholders was Mr. Ji’s brother. In early 2023, he invested a total of 400 million KRW in EID and Ewha Electric. This was money he had painstakingly saved from his salary and stock investments while working. Seeing the rapidly rising stock prices, he thought he had to get on board. And it was justified. As Ewha Group affiliates were categorized as secondary battery-related stocks, EID’s closing price rose from 834 KRW on January 2, 2023, to a peak of 3,860 KRW on April 20, 2023. The stock price more than quadrupled in just three months.

Mr. Ji’s brother began to recommend Ewha Group-related stocks to those around him as if spellbound. He even recommended stocks to his older brother, Mr. Ji. Unable to resist his persistent recommendations, Mr. Ji purchased 50 million KRW worth of EID shares.

"I’m sorry, hyung (older brother)."

When the Korea Exchange decided to delist Ewha Group affiliates on September 1, 2023, Mr. Ji’s brother apologized to him. Mr. Ji comforted him, saying it was okay. But after the trading suspension, his brother rarely left the house. Mr. Ji thought his brother, who was usually bright, would shake it off and move on. He did not know his brother had little time left.

"I don’t need the 50 million KRW and don’t even think about it. I’m still tormented by guilt over my brother’s death. I should have told him more strongly not to invest in stocks..."

Reality Sinking into Quicksand... Small Shareholders Left Helpless

Kim Hyun, representative of the Ewha Group Shareholders' Solidarity, is speaking at a gathering of minority shareholders opposing the delisting simplification policy held on the 10th in front of the Korea Exchange in Yeouido, Seoul. Representative Kim urged for the clarification of delisting review criteria, the introduction of differentiated delisting procedures based on embezzlement and breach of trust, strengthening transparency of companies and related institutions, and social public discussion to protect shareholder rights. 2025.02.10 Photo by Yoon Dong-ju

What happened to EID, which was suspended from trading? Like some companies, it objected to the Korea Exchange’s delisting decision. The Korea Exchange postponed the delisting decision on EID, giving it time and opportunity to improve itself.

However, EID continued to disappoint small shareholders. On March 21 last year, it disclosed a refusal of audit opinion. A refusal means the auditor judged that they could not perform the audit or that there were serious issues making it difficult for the company to continue operations. The Korea Exchange usually decides on delisting in such cases, but EID filed another objection, delaying the judgment. On August 28 last year, it even reversed a disclosure and was designated as a non-compliant disclosure company.

As the trading suspension of Ewha Group affiliates prolonged, the pain of small shareholders grew. On February 10, they gathered in front of the Korea Exchange in Yeouido, Seoul, expressing anger over their assets being frozen due to the trading suspension. Kim Hyun, representative of the Ewha Group Small Shareholders Solidarity, lamented at the rally, "Due to immoral directors and major shareholders’ embezzlement and breach of trust, and the lack of stock market management and supervision systems, my precious assets have turned into worthless scraps overnight." This is not just EID’s story. According to the Korea Exchange, as of last month’s 1st, the average trading suspension period for 104 companies was about 473 days. Fifteen companies have been suspended for over 1,000 days.

Time is running out for Ewha Group affiliates. On the 14th of last month, the Korea Exchange decided to delist Ewha Electric, EID, and E-Tron. Although the three companies submitted improvement plan implementation reports and requested review in January, they were ultimately targeted for expulsion. However, delisting did not occur immediately. Ewha Electric, EID, and E-Tron filed injunctions to suspend the effect of the delisting decision. If the court rejects the injunction, the stocks of Ewha Group affiliates will enter the delisting process, including orderly liquidation. On the 17th of last month, through their respective websites, the three companies expressed regret, saying, "We apologize to shareholders and employees who trusted and waited for us," and "We deeply regret the delisting decision and demand clear explanations from the Korea Exchange."

After the Brother, Even the Mother... A Family Collapsed by the Capital Market

Minority shareholder victim Ji-mo (50, male) is shouting slogans at a rally of minority shareholders opposing the simplified delisting policy held in front of the Korea Exchange in Yeouido, Seoul on the 10th. 2025.02.10 Photo by Yoon Dong-joo

When I met Mr. Ji again last month in Jung-gu, Seoul, he shared more bad news. His mother had also passed away. After the brother, who was as gentle as a daughter, committed suicide, the mother’s health rapidly deteriorated. Frequently hospitalized, she eventually died of a myocardial infarction on August 13 last year. August 13 was also the brother’s birthday. "Even the heavens are indifferent," Mr. Ji bowed his head.

Currently, Mr. Ji’s home is filled only with silence. His father drinks more than four times a week. During this Lunar New Year, his father stayed locked in his room, repeatedly saying he had no appetite. He used to be a man who ate large bowls of rice. Since his brother’s suicide, Mr. Ji has been gradually replacing his depression medication with alcohol. His mother’s death was the trigger. The exercise he started to forget his brother’s death has also gradually stopped. A family has collapsed in Korea’s capital market.

Having lost family members one after another, Mr. Ji expressed resignation toward Ewha Group but could not hide his anger. His lips trembled on his hardened face. "The Korean capital market killed my brother. Does it only count as murder if stabbed with a knife?"

Order of Articles in the 'Tears of Small Shareholders' Series

▶"The Korean Capital Market Killed My Brother"
①Trading Suspension Due to Executive Embezzlement... A Family Collapsed by the Capital Market

Over 1 trillion KRW embezzlement crimes in listed companies over 3 years... 402.5 billion KRW last year alone
②Trading Suspensions and Delistings Continue... Embezzlement and Breach of Trust Punishments Are 'Lenient'

Among 78 cases of embezzlement over 500 million KRW, only 7 received aggravated punishment... Despite shareholders’ petitions for severe penalties, punishments remain lenient
③Comprehensive Review of First Trial Sentences for Embezzlement under the Special Criminal Act... Difficult to Punish High-Value Embezzlement Crimes

Small shareholders excluded from shareholder meetings... Worries over 'one-way street'
④Voices of Shareholders Ignored at the 'Flower' of Corporations, the Shareholder Meeting

No progress in strengthening embezzlement punishments... Urgent need to resolve information asymmetry issues
⑤Small Shareholders and Experts Discuss Laws to Protect Small Shareholders