Securities Deliberation Committee imposes 700 million won fine on 4 foreign asset managers and pension funds for 'naked short selling'

[Asia Economy Reporter Park Jihwan] The Securities and Futures Commission has decided to impose a total fine of 730 million KRW on foreign asset management firms and four pension funds for violating the law prohibiting naked short selling.

The Financial Services Commission announced on the 17th that the Securities and Futures Commission resolved this measure at its 17th regular meeting held the previous day. This case occurred before the temporary short selling ban, which has been in effect since March of this year.

It was confirmed that these asset management firms and pension funds placed sell orders without holding or borrowing stocks due to errors regarding whether borrowing contracts were concluded or stocks were held.

The Securities and Futures Commission has taken a strict stance on violations of short selling restrictions by financial firms, considering even cases caused by errors as breaches of basic duty of care, and plans to sanction even when the financial firms have no or minimal profit.

Short selling is an investment technique where investors sell stocks they do not hold in anticipation of a price decline. Under current law, one must borrow stocks before selling them short.

This content was produced with the assistance of AI translation services.