Caught in the Crossfire: How Predicting Stock Price Manipulation Can Still Land You in Hot Water
Second Verdict in Deutsche Motors Stock Price Manipulation Case
The appeals court in the Deutsche Motors stock price manipulation case has confirmed that the charge of aiding and abetting stock price manipulation is established only with “unwritten knowledge” or foresight.
According to the ruling, the appeals court found Mr. Son, the owner of Jeonju, guilty of aiding and abetting stock price manipulation, stating that “even if there was no specific knowledge (of the principal of the crime), the unwritten knowledge and foresight were sufficient to constitute aiding and abetting.” This precedent involves a case in which the principal offender was found guilty of aiding and abetting a group of people who provided funds and names when the principal offender acquired a joint-stock company under a borrowed name.
The appeals court ruling also revealed that Mr. Lee, who is active as a stock manipulator, and Ms. Kim met. The court stated that “around January or February 2010, Kwon Oh-soo (former chairman of Deutsche Motors) said, ‘I was looking for someone who could manage stocks and make a profit,’ and introduced the defendant, Mr. Lee, to his acquaintances, including Kim Geon-hee, Mr. Lee, and Mr. Oh.”
However, the fact that the stock trading patterns of Mr. Son and Ms. Kim are quite different is considered a variable. Mr. Son made transactions during all the stock price manipulation periods (1st to 5th rounds) from December 2009 to December 2012, and Ms. Kim’s trading was concentrated in the 1st and 2nd periods from December 2009 to April 2011.
The ruling also included the fact that Kim Man-bae, the majority shareholder of Hwacheon Daeyu Asset Management, threatened former Chairman Kwon while he was working at the media company, saying, “I will report the stock price manipulation.”
Two of the nine defendants filed an appeal on the 13th, the day after the appeals court’s decision, and the case was decided by the Supreme Court.