FSC to refer former executives of Meritz to prosecution for unfair stock trading
Meritz Group's office in Seoul / Courtesy of Meritz Fire and Insurance
Financial authorities said Thursday they have decided to refer four former executives and one employee of local insurer Meritz Fire and Insurance to the prosecution on suspicions they had used insider information for profit-taking.
The Securities and Futures Commission under the Financial Services Commission (FSC) made the decision at a regular meeting held the previous day.
The former executives are said to have purchased a large number of shares in Meritz Financial Group before the holding company announced plans in November 2022 to merge two of its affiliates — Meritz Securities and Meritz Fire and Insurance.
Each of the former executives reportedly made more than 500 million won ($359,761) as share prices of the holding company hit the daily upper limit following the announcement.
The FSC suspects that the former executives were aware of the merger plan before its official announcement and bought the shares in advance, with the intent to sell them at a higher price.
"Employees at financial firms are held to a higher standard of ethics. We plan to thoroughly investigate cases of employees at financial firms using undisclosed information," the FSC said.