Korean Stock Market Turned into Playground for Foreign Short Selling... "94% of Illegal Short Selling by Foreigners"

[Asia Economy Reporter Changhwan Lee] It has been revealed that most of the violators caught by financial authorities for illegal short selling are foreigners.

According to the 'Detailed Measures on Illegal Short Selling' disclosed on the 31st by Lee Jung-moon, a member of the Democratic Party of Korea, through the Financial Supervisory Service, out of 127 individuals who received fines or warnings for illegal short selling from 2010 to the present, 119 (93.7%) were foreigners.

Rep. Lee stated, "Considering that the proportion of foreign transactions in the cumulative short selling transaction amount over the past five years is around 70% (67.9%), the fact that over 90% of those committing illegal short selling are foreigners shows that the financial authorities' efforts to eradicate illegal short selling by foreigners have been passive."

He also pointed out that the punishment for illegal short selling is "too lenient." In the past five years, a total of 82 cases of illegal short selling were detected, and excluding three cases where no fines were imposed, the total number of shares traded through these cases was 151 million shares.

This means that an average of 1.94 million shares of illegal short selling occurred per case. The average penalty for this was only 163 million KRW.

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