Financial Authorities Revoke Licenses of Shilla Asset Management and Zenith Investment over IPO Subscription Fraud

Financial authorities have decided to take the highest level of disciplinary action by revoking the financial investment business licenses and registrations of Shilla Asset Management and Zenith Investment Advisory, which embezzled investment funds under the guise of proxy public offering subscriptions.

The Financial Services Commission announced today (the 23rd) that during its 16th regular meeting, it decided on these disciplinary measures, along with demands for the dismissal of executives and the imposition of fines and penalties on the companies.

According to the findings of the Financial Supervisory Service's inspection, Shilla Asset Management was found to have failed to engage in permitted business activities and violated minimum capital maintenance requirements, leading to the revocation of its public collective investment business license and general private collective investment business registration.

In addition, Shilla Asset Management was fined 1.494 billion won for falsely disclosing business reports that violated accounting standards and failing to disclose and report major management conditions.

A penalty of 20 million won was also issued for violating restrictions on credit extensions to major shareholders.

A demand for dismissal was issued against a former executive who violated disclosure obligations.

Zenith Investment Advisory also had its investment advisory and discretionary investment business registrations revoked due to failure to engage in registered business activities and violations of minimum capital maintenance requirements.

A fine of 1.28 billion won was also imposed for the false disclosure of business reports, and a decision was made to demand the dismissal of former and current executives.

Financial authorities emphasized, "We will strictly monitor regulatory violations and apply rigorous post-sanctions so that the asset management, investment advisory, and discretionary investment industries can maintain market order and grow based on investor trust."

(Photo: Provided by Yonhap News TV, Yonhap News)
※ Please note: This article was translated by AI and may contain errors.