Cracking Down on Unfair Trades: Top Financial Authorities Unite to Launch High-Stakes Investigation
Unfair Trade Investigation and Review Agency Council Strengthens Response System
The Financial Services Commission, the Prosecutors’ Office, the Financial Supervisory Service, and the Korea Exchange jointly held the 2nd ‘Unfair Trade Investigation and Review Agency Council’ in 2024 to discuss major issues related to unfair trade.
Improving Investigation Efficiency
The council reviewed and discussed ways to improve investigation efficiency to strengthen investigations into unfair trade practices. The main focus was on effectively responding to cases where reading rooms are opened using social media platforms such as Telegram, and unfair trade practices like insider trading are committed.
Concentrated Deliberation System
The Securities and Futures Commission will activate the ‘concentrated deliberation system’, which utilizes temporary deliberation committees or meetings to intensively review and conclude systems and events that have a major impact on the market. This is expected to enhance the reliability and completeness of deliberation.
Recent Major Cases of Unfair Trade Practices
The Financial Services Commission disclosed two major cases of measures taken by the Securities and Futures Commission related to unfair trading. The first case involved an insider using undisclosed material information to make illicit profits through CFD (Contract for Difference). The second case involved raising funds using the stocks of a company acquired through a no-capital M&A as collateral and manipulating the stock price.
Publicizing Cases of Violations
The Financial Services Commission emphasized the need to actively publicize cases of violations and matters for investors to be aware of. Each institution must actively publicize unfair trading measures and matters for investors to be aware of using various media.
Fair Trade Commission
The Financial Services Commission and other related organizations will continue to closely discuss unfair trade issues through the working-level consultative body under the Fair Trade Commission. They will work on improving the system to ensure fairness in the capital market by discussing major unfair trade issues and improvement measures for investigation and examination systems.
Strengthening Unfair Trade Response System
The council aims to establish an organic and efficient unfair trade response system, including detection and examination of suspicions, investigation, and prosecution. The Financial Services Commission and other related organizations agreed to actively identify and improve areas where improvements are needed to respond to unfair trade practices.
Key Takeaways
The Financial Services Commission and other related organizations will continue to discuss unfair trade issues through the working-level consultative body under the Fair Trade Commission.
The Securities and Futures Commission will activate the ‘concentrated deliberation system’ to enhance the reliability and completeness of deliberation.
The Financial Services Commission will actively publicize cases of violations and matters for investors to be aware of.
The council aims to establish an organic and efficient unfair trade response system.