"Respectable People Involved in Unfair Trade... Strict Punishment for Abuse of Position and Unfair Gains"

1 Year Since Inauguration, Lee Bok-hyun: "Full Effort to Eradicate Unfair Practices in Capital Markets... Difficult to Resume Short Selling"
Concerns Over KOSPI Volatility... Hard to Predict Short Selling Resumption Timing

Lee Bok-hyun, the Financial Supervisory Service (FSS) chief who has marked his first year in office, declared his intention to eradicate unfair trading practices such as stock price manipulation that undermine trust in the capital market. He strongly expressed his determination to make an all-out effort, even if it means taking a last stand. He also stated that it is difficult to pinpoint the timing for the resumption of short selling at this moment.

At a press briefing held in Yeouido on the same day, Director Lee said, "We will eradicate illegal private loans and financial fraud that hurt ordinary people," adding, "We will strictly respond to market-disrupting activities such as unfair trading, illegal short selling, and the spread of malicious rumors, and promptly improve systems where investor protection and other institutional enhancements are needed." He continued, "A financial market without fairness and trust is like a sandcastle," emphasizing, "We will take a last stand and strive as the final bastion to stabilize the financial market and eradicate unfair practices in the capital market."

Reflecting on whether he may have underestimated issues related to unfair trading or internal violations within financial institutions since his appointment, he explained that, as a former prosecutor, he recognizes that this is not a problem he can solve alone. Therefore, he is working to establish a cooperative system that allows the FSS, Financial Services Commission, Southern District Prosecutors' Office, and Korea Exchange to operate in an integrated manner.

Director Lee said, "The KOSPI market surpassed 2,500 a long time ago but still hovers around that level," adding, "Those who have committed illegal acts or exploited opportunities must receive sufficient penalties to restore trust in the capital market." He further stated, "Many people with respectable jobs and conduct engage in unfair trading for the purpose of gaining significant profits," and noted, "We will first focus on unfair trading by professionals or organized groups aiming for large sums over a long period."

He said, "We will strictly punish those who have an advantage over general investors in the financial market and use their position to gain unfair profits or benefit from conflicts of interest, and we are devising measures to recover illegal gains as well."

Regarding criticism from some quarters about his overseas business trip during the Soci?t? G?n?rale (SG) Securities stock price crash incident, Director Lee said, "Before the trip, I played a behind-the-scenes role in forming a joint investigation team and ensuring that procedures to arrest the main culprits were carried out, but there are some regrets."

On the full resumption of short selling, he said it is still difficult to specify the timing. Director Lee stated, "There are ongoing sanction procedures related to illegal short selling, and additional internal investigations are underway," adding, "Due to persistent market instability caused by high interest rates, it is difficult to determine the timing of the short selling resumption at this point. Once the market stabilizes, we expect in-depth discussions centered on the Financial Services Commission." Although he mentioned a "full resumption of short selling within the year" last March, it is interpreted that he has stepped back amid growing controversy.

Regarding virtual assets, he explained, "Before legislation, the Financial Services Commission and FSS found it difficult to intervene," adding, "Recently, the first legislation passed the Political Affairs Committee, and considering the legislative process and government decision-making procedures, it is not too late. We are exploring measures such as collecting damage cases through a virtual asset financial damage reporting center."

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