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Photo = Yonhap news |
[Alpha Biz= Kim Sangjin] A senior executive at Kiwoom Securities has been caught attempting to use insider information for personal gain, following a broader investigation into the company’s internal controls after the "Ra Deok-yeon stock manipulation scandal" last year.
According to a report by Edaily on Monday, the Financial Supervisory Service (FSS) has recently conducted a disciplinary review of an executive, identified as A, who allegedly tried to exploit confidential information obtained through his position at Kiwoom Securities. A used insider information to attempt to benefit personally from an investment where the company’s funds were involved. Authorities are considering high-level sanctions, viewing the case as a breach of fiduciary duty due to inadequate internal controls.
The discovery of A's actions stemmed from a wider inspection conducted by the FSS after the "Ra Deok-yeon stock manipulation" incident last year. The FSS expanded its investigation to include a review of Kiwoom Securities’ overall internal control systems, which led to the identification of A’s misconduct.
The Ra Deok-yeon scandal involved the use of contracts for difference (CFD) by Ra Deok-yeon, CEO of H Investment Advisory, to manipulate the prices of low-liquidity stocks. A large volume of sell orders through Societe Generale Securities caused the prices of eight stocks to plummet, leading to significant losses for retail investors. Kiwoom Securities’ CFD accounts were used in this process, and it was also revealed that former Daou Kiwoom Group Chairman Kim Ik-rae had sold large quantities of Daou Data stock, which was one of the affected stocks, prior to the price manipulation. The scandal has sparked significant controversy.
Alphabiz Reporter Kim SangJin(letyou@alphabiz.co.kr)
