Prosecutors Indict Group Involved in Fundraising for Edison Motors Stock Manipulation

Allegations of EdisonEV Stock Manipulation
Through False Disclosures
"Each Made 2 to 6 Billion Won in Price Gains"

The prosecution has indicted the fundraisers accused of procuring the stock purchase funds in connection with the Edison Motors stock manipulation case. Photo by Hyunmin Kim kimhyun81@

[Asia Economy Reporter Oh Gyumin] The prosecution has indicted the fundraisers suspected of procuring the stock purchase funds in connection with the Edison Motors stock manipulation case.

On the 6th, the Seoul Southern District Prosecutors' Office Financial Securities Crime Joint Investigation Team (Head Dan Seonghan) indicted six people, including A (49), an advisor at an asset management company, on charges of violating the Capital Markets Act related to the capital market and financial investment business.

According to the prosecution, they are accused of manipulating the stock price of Edison Motors affiliate Edison EV (now Smart Solutions) through false disclosures from May last year to March this year.

Prosecutors' investigation revealed that they posed as legitimate financial investors and caused the stock price to surge by disseminating false positive information such as ▲ false fund-raising disclosures worth 195 billion KRW ▲ selection as the preferred bidder for Ssangyong Motor M&A through false acquisition fund evidence ▲ announcement of contract signing without the ability to raise acquisition funds. As Edison EV's stock price surged from October to November last year, they are known to have sold their holdings intensively and gained illicit profits worth between 2 billion and 6 billion KRW each.

On the 18th of last month, the Seoul Southern District Court held a pre-trial detention hearing for A and others, issuing arrest warrants for five individuals citing concerns over evidence destruction and flight risk. However, one member of the group was exempted from the warrant request to ensure the right to defense.

The 'Edison Motors stock manipulation case' dates back to October last year. At that time, Edison Motors was selected as the preferred bidder for the acquisition of Ssangyong Motor and signed a merger and acquisition (M&A) contract. The stock price of Edison EV, the company's funding channel, surged on expectations of the Ssangyong acquisition.

During this process, the major shareholder investment association of Edison EV sold most of its shares and realized profits, sparking controversy over a 'pump and dump.' Ultimately, the merger failed as Edison Motors was unable to pay the remaining acquisition funds.

On October 24 last year, the prosecution indicted Kang Youngkwon, chairman of Edison Motors, and three former executives of Edison Motors, Edison EV, and related companies on charges of violating the Capital Markets Act and other offenses for illicitly profiting 162.1 billion KRW by inflating Edison EV's stock price.

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