On Thursday, financial authorities declared a set of augmented regulations to crack down on illicit stock trading in the wake of numerous stock manipulation scandals.
The Financial Services Commission (FSC), the Financial Supervisory Service (FSS), and other related agencies made the announcement while an investigation is still ongoing into a stock manipulation case where a group of members of an online trading community allegedly raised 700 billion won (US$523.4 million) by manipulating stock prices of eight companies listed on the main KOSPI and tech-heavy KOSDAQ indexes from May 2019 to April of this year.
Kim Jeong-kag, a senior official at the Financial Services Commission, announces measures to improve financial authorities' response system to unfair trading at the government complex in central Seoul on Sept. 21, 2023. (Yonhap)
Under the new regulations, the FSC, the FSS, the Korea Exchange, and the prosecution will be collaborating regularly to monitor the market, share information, and manage cases of unfair trading more effectively.
The authorities will also be reinforcing the detection of abnormal trading patterns, including a long-term upward trend of stock prices, and enhancing the warning systems for such patterns in stock markets.
Sanctions for unlawful trading will also be reinforced.
The financial authorities intend to push for freezing the accounts suspected of unfair stock trading.
In May, a bill was passed to prohibit individuals who have committed unfair trading from making transactions in the capital market for a maximum of 10 years and getting jobs at listed companies and financial firms.
A law is also scheduled to take effect in January next year to impose a fine of up to twice the value of profits generated by unfair trading.
The number of people investing in South Korean stock markets more than doubled from 6.14 million in 2019 to 14.4 million in 2022, and the trading value increased from 2.29 quadrillion won to 3.91 quadrillion won over the same period.
nyway@yna.co.kr
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