Financial Supervisory Service and National Police Agency's National Investigation Headquarters Join Forces to Combat Illegal Activities in Capital Markets: "First Step to Eradicate Crime"

The Financial Supervisory Service (FSS) announced on the 16th that it has signed a Memorandum of Understanding (MOU) with the National Police Agency’s National Investigation Headquarters to strengthen cooperation and response to illegal activities in the capital market.

Financial Supervisory Service, Yeouido, Seoul. Photo by Jinhyung Kang aymsdream@

The FSS and the National Police Agency have maintained an organic cooperative relationship through MOUs related to livelihood finance issues such as voice phishing and illegal private loans. However, systematic and continuous collaboration and cooperation between the agencies regarding illegal activities in the capital market, such as illegal leading rooms, had been insufficient.

Accordingly, both agencies recognized that the current individual institutional response systems have certain limitations in providing efficient and systematic responses due to a lack of expertise and experience, and thus signed the MOU.

This MOU includes five key items: strengthening cooperation and coordination in victim prevention publicity, information sharing, joint crackdowns, mutual capacity-building support, and faithful implementation of existing MOUs related to voice phishing and illegal private loans.

Specifically, it includes joint public awareness campaigns for the public on cases of damage caused by illegal leading rooms and prevention methods. It also covers information sharing related to illegal activities in the capital market. The FSS will actively share information requiring judicial action with the National Investigation Headquarters, such as investment fraud caused by leading rooms, illegal business activities, and embezzlement allegations involving financial company executives and employees. The National Investigation Headquarters will share information on unfair trading, illegal activities by financial companies, and accounting fraud in listed companies obtained during investigations or information collection with the FSS.

The agreement also covers joint crackdowns, investigations, and prosecutions. A joint crackdown team will be operated for illegal investment explanation meetings, and for major cases deemed to require joint investigation or cooperation, available human and material resources will be supported after consultation. Additionally, the FSS will open training programs to support the capital market expertise of investigators, and the National Investigation Headquarters will provide related infrastructure such as the transfer of investigative techniques.

Furthermore, the cooperation relationship through faithful implementation of existing MOUs related to voice phishing and illegal private loans will be continuously maintained.

Lee Bok-hyun, Governor of the FSS, stated, "Recently, illegal activities that undermine the order of the capital market, such as unfair trading and investment fraud riding on the activation of individual direct investment, have been rampant. We are making every effort to eradicate related crimes through the establishment of leading room crackdown teams and information collection teams." He added, "We expect to achieve visible results through collaboration and cooperation that organically combine the expertise and infrastructure of each agency based on this agreement."

Woo Jong-su, Chief of the National Investigation Headquarters, emphasized, "We plan to promptly implement follow-up measures so that the agreement leads to tangible results that the public can feel. We promise to solidify the cooperation between the two agencies and serve as a catalyst to eradicate evolving capital market crimes."

An FSS official explained, "This MOU expands the scope of cooperation and collaboration to the capital market sector in response to illegal activities in the capital market. Both agencies have a strong will to respond and see this as the first step toward achieving the common goal of eradicating related crimes."

He added, "We plan to prepare detailed implementation plans through working-level consultations to ensure the MOU’s contents are concretely realized. We will firmly establish mutual cooperation and collaboration between the two agencies across all stages from capital market-related damage prevention, crackdowns, to punishment, and respond strongly to related criminal activities."

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