An investor relations (IR) executive at a KOSDAQ-listed company has been caught making 20 million won in illegal profits using unpublished internal information.

The Securities and Futures Commission under the Financial Services Commission announced today (September 2) that it has referred executive A of a KOSDAQ-listed corporation to investigative authorities on charges of violating the Capital Markets Act by using unpublished material information.

According to financial authorities, investigations revealed that executive A used favorable, unpublished internal information—such as key results from a phase 1 clinical trial of a developing new drug and the conclusion of a technology transfer contract—to purchase company shares under an acquaintance's name between March and June 2024.

Through this, the executive acquired approximately 20 million won in illegal profits and also evaded the obligation to report ownership statuses.

When insiders use unpublished material information for trading, they can face imprisonment with labor for one year or more or fines of up to six times the amount of illegal profits under the Capital Markets Act.

Fines of up to twice the amount of illegal profits may also be imposed.

In addition, executives or major shareholders must report any stock holdings or changes in status within five days.

The Securities and Futures Commission stated, "To secure fairness in the capital market and protect investor confidence, we will closely monitor unfair trading practices and strictly penalize detected illegal activities."

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