Financial Authorities Notify Prosecutors of Former Taekwang Group Chairman Lee Hojin... Violation of Nominee Stock Disclosure Regulations

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[Asia Economy Reporter Park Jihwan] Financial authorities have reported former Taekwang Group Chairman Lee Hojin to the prosecution for violating the disclosure obligation of nominee stocks.

According to financial authorities on the 13th, the Securities and Futures Commission under the Financial Services Commission resolved at the regular meeting in February the 'Measures on the investigation results of violations of large-scale holding reporting obligations regarding Taekwang Industrial and Daehan Fiber stocks,' which was proposed by the Financial Supervisory Service.

The measures included that former Chairman Lee violated the large-scale holding reporting obligation and ownership status reporting obligation under the Capital Markets Act by failing to properly report nominee stocks of Taekwang Industrial and its affiliate Daehan Fiber. Based on the investigation results on the disclosure obligation, the Financial Supervisory Service recommended notifying the prosecution according to the capital market investigation regulations, and the Securities and Futures Commission accepted this.

In April last year, while on trial for charges including embezzlement and breach of trust, former Chairman Lee voluntarily converted 151,207 shares of Taekwang Industrial and 9,489 shares of Daehan Fiber into his real name and reported them to the financial authorities. After his voluntary report, the Financial Supervisory Service investigated whether there was a violation of shareholding disclosure and found that he submitted large-scale holding status reports and ownership stock status reports without including nominee stocks in his own holdings, thus making false entries.

The investigation confirmed that former Chairman Lee held approximately 150,000 shares of Taekwang Industrial under the names of 119 other individuals as nominee holdings. The financial authorities judged that between a minimum of 123,753 shares and a maximum of 138,022 shares were falsely reported.

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