'Cancer Treatment Drug Development'... KH Philux Former Executives Who Pocketed 63.1 Billion Won Indicted and Detained

Former executives of KH Philux, who manipulated stock prices by spreading false disclosures about developing cancer treatment drugs and gained unfair profits worth around 60 billion KRW, have been indicted while in custody.

The Joint Financial and Securities Crime Investigation Division of the Seoul Southern District Prosecutors' Office (Chief Prosecutor Gong Jun-hyeok) announced on the 31st that three former executives, including KH Philux Vice Chairman Ahn, were indicted in custody on charges of violating the Capital Markets Act.

They are accused of artificially inflating stock prices by acquiring the KOSPI-listed company KH Philux without capital in 2016, then raising funds worth around 100 billion KRW in 2018, and distributing false disclosures and press releases suggesting a joint development project for cancer treatment drugs with a U.S. biotech company, thereby gaining unfair profits worth approximately 63.1 billion KRW. During this period, KH Philux's stock price soared from 3,480 KRW to 27,150 KRW.

Earlier on the 8th, prosecutors arrested two individuals, former Vice Chairman Park and former CEO Ahn. Ahn, who fled overseas, was apprehended and extradited from a Philippine airport last month through an Interpol red notice and was detained on the 20th of this month.

Prosecutors plan to continue investigations into KH Group Chairman Bae Sang-yoon, who is currently evading overseas arrest.

A prosecutor stated, "We will establish transparency, soundness, and fairness in the securities market with a zero-tolerance policy toward financial and securities criminals who gain illicit profits at the expense of ordinary investors' losses."

Reporter Lim Hyun-kyung, Legal Newspaper

※This article is based on content supplied by Law Times.

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