▲ The Joint Task Force for Eradicating Stock Manipulation holds a briefing.
The Joint Task Force for Eradicating Stock Manipulation has detected and referred more than 10 cases of unfair trading to the prosecution during its first year of operation.
Financial authorities plan to maintain a stance of strict response by strengthening investigations and sanctions.
Financial Services Commission Chairman Lee Won-keun held the '1st Anniversary Performance Review Meeting of the Joint Task Force for Eradicating Stock Manipulation' today (July 8) and stated, "The joint task force has played a role at the forefront of securing trust in the capital market by swiftly detecting and strictly sanctioning illegal activities." He added, "Through this, we have achieved results such as raising vigilance, establishing inter-agency collaboration systems, and settling the penalty surcharge system."
The joint task force, composed of the Financial Services Commission, the Financial Supervisory Service, and the Korea Exchange, launched on July 30 of last year with 36 members and has since expanded to 90 members.
The task force is currently working toward an expansion goal of 100 members.
The authorities explained that by integrating workspaces and removing operational silos among related agencies, they were able to conduct rapid analysis, immediate investigations, and joint probes to secure key evidence and respond to unfair trading in a timely manner.
Through these efforts, the task force has detected and investigated over 10 cases, including long-term market manipulation by high-net-worth individuals, insider trading by senior securities firm executives, and front-running by journalists, and has referred them to the prosecution.
Among these, the authorities preemptively imposed penalty surcharges on two cases, including the use of undisclosed information by internal employees of listed companies and broadcasting station staff, to recover illicit profits.
Financial authorities also stated that self-regulatory efforts have spread, such as strengthening internal controls related to unfair trading at securities firms and media outlets.
However, the task force has also shown limitations in some cases, such as the recent dismissal by the court of arrest warrants for all four suspects in the long-term market manipulation case by high-net-worth individuals, which was known as the task force's first major case.
The government is pushing to strengthen investigation and sanction powers to eradicate unfair trading.
It plans to establish the authority to request 'communication confirmation data' to prevent the destruction of evidence and identify information dissemination channels, and is pursuing a plan to expand the application of principal confiscation and forfeiture regulations to include not only market manipulation but also the use of undisclosed information and fraudulent transactions.
The government intends to propose an amendment to the Capital Markets Act during the third quarter.
To ensure strict sanctions, the authorities will rationalize the requirements and procedures for imposing penalty surcharges and are considering extending the suspension period for accounts involved in unfair trading.
Furthermore, they plan to introduce an 'Incident Analysis AI Agent' to upgrade the Korea Exchange's artificial intelligence surveillance system and prepare conditions for the early imposition of penalty surcharges.
In addition, the authorities plan to swiftly expel malicious and habitual offenders from the capital market by utilizing administrative measures such as restricting transactions in financial investment products and limiting the appointment of executives.
They also plan to strengthen the linkage between the joint task force's IT systems, update forensic equipment, and enhance the analysis functions for market information and tips at the Korea Exchange.
Chairman Lee urged, "We will not settle for the achievements of the past year and will respond more strictly through 'rapid detection, rigorous investigation, and zero-tolerance sanctions,'" adding, "I ask that the joint task force remain a powerful 'one team' to realize justice in the capital market."
(Photo: Yonhap News)
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