FSS Unable to Reach Conclusion in First Optimus Disciplinary Hearing... To Resume on 4th Next Month

[Image source=Yonhap News]

[Asia Economy Reporter Ji-hwan Park] On the 19th, the Financial Supervisory Service (FSS) held the first disciplinary review committee meeting targeting the distributor NH Investment & Securities and the custodian Hana Bank in relation to the Optimus Fund scandal but failed to reach a conclusion. The FSS plans to continue the review on the 4th of next month.

At 2:30 PM on the same day, the FSS held the disciplinary review and deliberated on the disciplinary levels for NH Investment & Securities and Hana Bank. The FSS stated, "We have sufficiently heard statements and explanations from multiple officials of the distributor and the FSS Inspection Bureau," and "We decided to hold another meeting on the 4th of next month."

Previously, the FSS had pre-notified disciplinary measures to NH Investment & Securities, the largest distributor of the Optimus Fund, the custodian Hana Bank, and the administrative manager Korea Securities Depository.

It is known that Young-chae Jung, CEO of NH Investment & Securities, was pre-notified of a three-month suspension due to inadequate internal controls. Not only Jung personally but also NH Investment & Securities as an institution reportedly received a pre-notification of a severe disciplinary measure. Hana Bank, the custodian of the Optimus Fund, was also pre-notified of a severe disciplinary measure such as an institutional warning. Although the Korea Securities Depository, which played the role of administrative manager, was also pre-notified of a severe disciplinary measure, it was excluded from the disciplinary review on this day.

Disciplinary measures against financial companies are classified into five stages: cancellation of registration/authorization, business suspension, corrective order, institutional warning, and institutional caution. Generally, institutional warnings and above are classified as severe disciplinary measures. The disciplinary levels for financial company executives are divided into five stages: dismissal recommendation, suspension, reprimand, cautionary reprimand, and caution, with reprimand and above classified as severe disciplinary measures. If severe disciplinary measures are imposed, restrictions on appointing financial company executives apply for three years for reprimand, four years for suspension, and five years for dismissal recommendation.

Considering the precedent of the Lime Fund disciplinary review, it is highly likely that the Optimus case will also require at least three or more discussions before reaching a consensus. If the disciplinary measures are approved in future disciplinary reviews, they will be submitted as agenda items to the Securities and Futures Commission and the Financial Services Commission before undergoing the final approval process.

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