A group accused of manipulating stock prices to earn unjust gains of 40 billion won has been reported to prosecutors by the Financial Supervisory Commission.
A criminal organization has been reported to the prosecutors for manipulating stock prices and accumulating unjust gains totaling 40 billion won, backed by more than 1 trillion won in funds. The Securities and Futures Commission, under the Financial Services Commission, held a regular meeting on the 11th where 11 individuals, including wealthy individuals operating general hospitals and large educational institutions, executives from asset management companies, and finance professionals as well as shareholder activists, were reported to the prosecutors along with four related corporations. This group targeted a specific stock with low trading volume, deploying corporate funds and loans to secure over 1 trillion won for market manipulation. They engaged in numerous underhanded practices such as organized trading, high bid purchases, buy orders, and influenced the stock price over a year and nine months to lure in investors.
The group also allegedly colluded with executives from the target company and employees from a securities firm to pressure the management into signing a trust contract for stock buybacks, coercing them to submit buy orders according to their schemes to manage stock prices and attract investors. Financial authorities assessed that the group reaped a total of 40 billion won in unjust profits through these fraudulent strategies.
Following this incident, which marks the first case under a joint response team initiated after President Lee Jae-myung emphasized fighting against unfair trading in capital markets, financial authorities intend to impose fines amounting to up to 800 million won, which is double the unjust earnings. Additionally, they plan to seize or reclaim the frozen assets totaling 1 trillion won, which includes stocks and hundreds of millions in cash, if criminal charges are confirmed.
