Prosecutors: Both Stock Plunge and Stimulus in 'SG Incident' Are Important... Suspect Investigation Already Underway

Q&A with Seoul Southern District Prosecutors' Office Official on the Afternoon of the 9th
Prosecutors: "Ra Deok-yeon Is Not the First Suspect to Be Investigated"

The prosecution investigating the 'SG (Soci?t? G?n?rale) Securities Stock Price Crash Incident' is conducting a comprehensive investigation ranging from stock price manipulation through collusive trading to the causes of the crash. The prosecution stated that, in addition to the arrested CEO Ra, suspects related to stock price manipulation have been summoned and are already under investigation.

[Image source=Yonhap News]

On the afternoon of the 9th, a representative from the Seoul Southern District Prosecutors' Office said in response to a question about whether the focus of the investigation was on stock price support or stock price crash, "(Both issues) are being addressed," adding, "To understand the cause of the stock price crash, we must first clarify how the stock price was supported." He further added, "The key to uncovering the truth is whether the rise and fall of the stock price was natural or not."

The 'SG Securities Stock Price Crash Incident' is a case suspected of stock price manipulation, where eight stock items sold through SG Securities have hit the lower price limit for consecutive days since the end of last month. The joint investigation team (Joint Investigation Team) formed by the Seoul Southern District Prosecutors' Office, the Financial Services Commission, and the Financial Supervisory Service believes that Ra Deok-yeon and CEO Hoan, among others involved in stock price manipulation, artificially boosted the stock price through collusive trading. Collusive trading refers to a method where buyers and sellers prearrange stock transactions.

The prosecution described the investigation into collusive trading circumstances as a 'labor-intensive' investigation. A prosecution official said, "Collusive trading is not a single transaction but involves multiple sales and purchases," adding, "We have to match and analyze both sides of the transactions, so it is very time-consuming." Currently, the Joint Investigation Team is analyzing over 200 mobile phones registered under investors' names seized by the police from Hoan. Additionally, the prosecution conducted a search of CEO Ra's office at Signiel in Songpa-gu, Seoul, and obtained warrants for his accounts and communications.

The prosecution is intensifying the investigation by summoning not only CEO Ra but also other suspects involved in stock price manipulation. When asked whether Ra Deok-yeon, who was arrested at his home that morning, was the first suspect to be investigated, the prosecution said there had been several others investigated as suspects. However, the prosecution did not disclose the exact number or identities of those charged, stating that the investigation is still in its early stages.

The prosecution plans to consider requesting an arrest warrant for CEO Ra, who was arrested on charges of violating the Capital Markets Act and the Act on Concealment and Disposal of Criminal Proceeds. If an arrest warrant is issued, the suspect can be detained for 48 hours. A prosecution official said, "The arrest warrant was issued because he is a key figure who led the crime and is expected to face severe punishment," adding, "Considering various circumstances from the investigation, we judged that if he were summoned voluntarily, there is a high possibility he would not appear or might flee or go into hiding." He also added, "There are various possibilities, but if an arrest warrant is requested after the investigation, additional charges may be added."

[Image source=Yonhap News]

Meanwhile, regarding Kim Nam-guk, a member of the Democratic Party of Korea suspected of holding about 6 billion won worth of WEMIX coins, a prosecution official said, "Since he is completely unrelated to the crime, the Financial Intelligence Unit (FIU) would not have notified the investigative agencies." The prosecution had requested a search warrant based on materials received from the FIU last year, but it was dismissed, so they have not been able to examine the flow of funds related to Representative Kim. A prosecution official said, "We are considering whether to reapply for the warrant."

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