View of Korea Exchange. (Photo= Korea Exchange)

 

[Alpha Biz= Reporter Kim Sangjin] Financial Supervisory Service Discovers Irregularities Among Korean Exchange Employees

On August 7, the Financial Supervisory Service (FSS) announced disciplinary actions against 68 employees of the Korea Exchange (KRX) for various violations. The FSS revealed that the employees were involved in unauthorized actions related to short selling and unreported stock transactions.

The FSS has imposed penalties including salary reductions, warnings, and fines. Some employees were directed to handle their own disciplinary measures or had actions omitted.

The Korea Exchange failed to carry out mandatory audits of securities firms' short selling practices from March 2016 to February 2021 without directives from the Market Surveillance Committee. Additionally, the exchange did not report 21 instances of capital market law violations discovered during audits between October 2016 and September 2021 to the Financial Services Commission (FSC).

Furthermore, numerous cases were found where exchange employees did not properly report their stock trading activities. Out of the 68 employees, 55 were found to have traded stocks without reporting account openings or trading details to the company, or used non-registered accounts for transactions. Employees are required to use only their registered accounts for stock trading and report their trading activities quarterly.

 

 

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