"EdisonEV, Suspected of Ssangyong Motor Fraud, Becomes First Target of Financial Supervisory Service Special Investigation"

Financial Authorities' Strong Commitment to Strict Investigation of Unfair Trading 'Empowered Special Judicial Police'
Market Anticipates First Investigation Case...Some Already Considered Under Investigation

[Asia Economy Reporter Lee Seon-ae] Edison EV, which was the funding channel for Edison Motors whose acquisition of Ssangyong Motor fell through, is highly likely to become the first investigation target of the Financial Services Commission's Capital Market Special Judicial Police (Special Judicial Police).

On the 8th, a senior industry official familiar with financial authorities stated, "The financial authorities have expressed their determination to thoroughly investigate unfair trading activities in the capital market and take strict measures, which has strengthened the recently launched Special Judicial Police," adding, "They are focusing on Edison EV, which has recently been at the center of controversy." Another senior official said, "Edison EV has had many issues from the beginning, and it is unusual that financial investors (FI) withdrew early from the acquisition consortium," adding, "There are many suspicions that they entered the acquisition battle aiming for stock price gains, so the fact that the exchange and financial authorities are examining it already implies a Special Judicial Police investigation."

Another senior official hinted, "The Special Judicial Police, launched to strengthen enforcement against unfair trading in the capital market, will aim to achieve results in the new government era that emphasizes fairness as a policy direction," adding, "Recently, the financial authorities have been at the center of criticism for being weak in all aspects of capital market management, supervision, and crackdown due to various incidents, so they will closely examine Edison EV to secure evidence." In this regard, a senior official from the Financial Services Commission said about whether Edison EV would be the first investigation target of the Special Judicial Police, "In principle, a cognizance investigation is possible."

Recently, the Ssangyong Motor acquisition battle has heated up again as Ssangbangwool Group and KG Group have shown interest. However, there are still many controversies regarding funding capabilities, and the related companies' stock prices have been highly volatile. The pattern of 'acquisition announcement → stock price surge → major shareholder profit realization → stock price plunge' continues to repeat. Accordingly, Jeong Eun-bo, Governor of the Financial Supervisory Service, also stated at a capital market-related executive meeting yesterday, "Recently, during the restructuring process through the acquisition of listed companies, there have been situations where the capital market was abused, undermining market trust and raising concerns about investor damage," adding, "If unfair trading allegations are found, we will conduct thorough investigations in consultation with the Financial Services Commission's Capital Market Investigation Team and take strict measures against illegal activities."

This is effectively targeting Edison EV and related companies involved in the Ssangyong Motor acquisition battle. Therefore, there is growing speculation that the Special Judicial Police will take command authority to prevent precedents such as the disposal of shares by Edison EV's major shareholder investment association.

The Korea Exchange has requested Edison EV to submit an opinion letter on the audit report presented as a 'disclaimer of opinion' by Samhwa Accounting Corporation by the 11th. Additionally, it is reported that an in-depth analysis is underway to determine whether there were any unfair trading activities related to the disposal of shares by Edison EV's major shareholders. If, after the exchange's review, the need for a criminal investigation is recognized, direct investigation by the Special Judicial Police is possible. Unlike the existing Financial Supervisory Service Special Judicial Police, the Financial Services Commission's Special Judicial Police is granted the authority to investigate self-cognized cases.

An industry official said, "There are investment groups that have gained large profits, but simply because a major shareholder sold shares, they cannot be punished," adding, "Ultimately, the key will be to find concrete evidence such as nominee accounts, collusive trading, and false acquisition documents to prove that they entered the acquisition battle for stock price gains."

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