Court Cancels Severe Disciplinary Action Against Former Meritz Asset Management CEO John Lee... Wins First Trial in Lawsuit Against Financial Services Commission

"Three Disciplinary Reasons Reduced to One,
Yet Same Penalty... Unlawful"

Former Meritz Asset Management CEO John Lee has won a lawsuit against financial authorities seeking to nullify disciplinary action taken against him. The court sided with John Lee, who requested the cancellation of a three-month suspension from duty, a severe penalty.

John Lee Meritz Asset Management CEO. Photo by Dongju Yoon doso7@

According to the legal community on April 18, the Seoul Administrative Court’s 14th Administrative Division (Presiding Judge Lee Sangdeok) ruled partially in favor of John Lee on April 17 in his lawsuit against the Financial Services Commission seeking to confirm the invalidity of disciplinary action for alleged unlawful or unfair conduct as a retiree.

Previously, the Financial Supervisory Service had decided on a three-month suspension for John Lee, citing three reasons: failure to manage conflicts of interest, failure to maintain a sufficient number of professionals, and violation of compliance obligations related to financial product advertising. The court found it unlawful that the Financial Services Commission ultimately cited only the failure to maintain a sufficient number of professionals as the reason for the disciplinary action, yet maintained the same level of penalty.

However, the court stated, "Since the violation of the obligation to maintain a sufficient number of professionals is recognized as a reason for disciplinary action, the defect cannot be considered serious and obvious," adding, "The request to confirm invalidity is not accepted, but the alternative request is upheld, so the disciplinary action must be canceled."

Previously, Meritz Asset Management faced controversy when four private equity P2P investment funds invested in products of Company P, in which John Lee’s spouse owned a partial stake. The court determined that the disciplinary reason related to alleged investments under borrowed names fell under the ‘obligation to manage conflicts of interest,’ but the Financial Services Commission’s final disciplinary decision did not recognize this as a reason for sanction.

John Lee gained public attention during the COVID-19 pandemic by emphasizing long-term stock investment. However, he resigned as CEO after allegations of investments under borrowed names surfaced.