Prosecutors Raid Meritz Securities Over Alleged Insider Trading with Undisclosed Information

Prosecutors have launched a raid in connection with allegations that former executives of Meritz Fire & Marine Insurance used undisclosed information to purchase stocks and gain illicit profits.

On January 8, the Financial Investigation Division 1 of the Seoul Southern District Prosecutors' Office, led by Chief Prosecutor Lim Sejin, conducted a search and seizure at the headquarters of Meritz Securities in Yeongdeungpo-gu, Seoul.

In July of last year, the Financial Services Commission's Securities and Futures Commission filed a complaint with the prosecution, accusing a former president of Meritz Fire & Marine Insurance, identified as Mr. A, and an executive-level official of violating the Capital Markets Act by using undisclosed information.

Investigations revealed that in November 2022, they obtained advance knowledge of the planned merger between Meritz Fire & Marine Insurance and Meritz Securities under Meritz Financial Group, and used family accounts to purchase stocks.

After the merger plan was announced and the share prices of Meritz Financial Group and related stocks surged, they reportedly sold the stocks they held, earning illicit profits amounting to several hundred million won.

In connection with this case, prosecutors also conducted a search and seizure in September of last year at the offices of Meritz Financial Group and Meritz Fire & Marine Insurance in Gangnam-gu, as well as at the residences of the suspects.