Police Summon and Investigate Jang Ha-won, CEO of Discovery Asset Management, Over Large-Scale Redemption Suspension

Seoul Metropolitan Police Agency file photo / Photo by Moon Honam munonam@

[Asia Economy Reporter Yoo Byung-don] The police have summoned Jang Ha-won, CEO of Discovery Asset Management (63), for investigation in connection with the large-scale private equity fund redemption suspension incident.

The Financial Crime Investigation Unit of the Seoul Metropolitan Police Agency announced that at around 9:40 a.m. on the 9th, they summoned CEO Jang, who is suspected of fraud under the Act on the Aggravated Punishment of Specific Economic Crimes and violations of the Capital Markets Act, and are currently investigating him.

According to the police, CEO Jang is suspected of causing significant damage to investors by launching the product while hiding the fact that the fund was highly likely to become insolvent.

The Discovery fund incident occurred in 2019 when a fund worth 256.2 billion won managed by Discovery Asset Management had its redemption postponed due to the legal management of a local U.S. asset management company, resulting in massive investor losses.

The fund was sold for thousands of billions of won through institutions such as Industrial Bank of Korea, Hana Bank, and Korea Investment & Securities.

Previously, the Financial Supervisory Service had imposed a heavy disciplinary action suspending CEO Jang from his duties.

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