Regulator to get tougher on stock manipulation, accounting flaws

Financial Services Commission Vice Chairman Kwon Dae-young / Yonhap

The head of the oversight body for the local stock market said Wednesday that his agency will get tougher on stock manipulation and accounting flaws.

Kwon Dae-young, the head of the Securities and Futures Commission under the Financial Services Commission (FSC), said the commission will sternly penalize illegal and unfair practices that undermine market principles.

"We will also take stern measures against accounting flaws," he said.

Kwon, who also serves as vice chairman of the FSC, said his agency will update related regulations to meet fast changes in the market conditions.

The country's financial authorities have been preaching for a zero-tolerance approach and respond firmly to acts that undermine market order and fairness, such as stock price manipulation and the abuse of dominant market positions.

President Lee Jae Myung earlier called for stern measures against stock manipulation and unfair trading practices as part of efforts to boost the local financial market.

Starting in October, those caught illegally trading stocks will face fines of up to twice the amount of their unjust gains, while the market monitoring system will be based on individuals rather than trading accounts.

Stock manipulators will be barred from the capital market for up to five years under a new "one-strike-out" system that will limit their trading of financial investment products and disqualify them from serving as executives at listed companies.