Involvement in Price Manipulation During the "Second Phase Operation"
Prosecutors re-investigating the stock price manipulation allegations involving First Lady Kim Keonhee and Deutsche Motors have summoned and questioned the so-called "main operator" responsible for the second phase of the operation. The term "main operator" is slang for the chief planner of a stock manipulation scheme who contacts the target company and controls the stock price.
According to the legal community on May 29, the Criminal Division of the Seoul High Prosecutors' Office (headed by Cha Soonkil) summoned Kim, who played the role of main operator during the second phase of the stock manipulation operation, as a reference witness the previous day and questioned him for about four hours and thirty minutes.
Kim, who managed First Lady Kim's account and participated in the price manipulation of Deutsche Motors, was sentenced to two years in prison with a three-year suspended sentence, a verdict finalized by the Supreme Court last month. It is reported that prosecutors specifically questioned Kim about the communication system at the time of the "7-second sell-off" and the process of placing a sell order using First Lady Kim's account.
On November 1, 2010, Kim sent a message to Min, an executive at Black Pearl Investment, saying, "At 12 o'clock, please hit 80,000 shares at 3,300." Min replied, "I'll have it prepared." Kim then sent another message instructing Min to sell, and seven seconds later, an order to sell 80,000 shares of Deutsche Motors at 3,300 won was placed from First Lady Kim's Daishin Securities account.
The court recognized this transaction as a prearranged trade. However, when prosecutors decided not to indict First Lady Kim last year, they explained that they had not secured evidence to prove that she had received instructions and submitted the order herself.
Meanwhile, it has been reported that prosecutors also summoned and questioned Min on May 27. Min was sentenced to one year and six months in prison with a three-year suspended sentence in the first trial and is currently undergoing an appeal trial.
© The Asia Business Daily(www.asiae.co.kr). All rights reserved.
