Mirae Asset Securities under pressure for funding screenings of controversial film after leveraged ETF row

Mirae Asset Securities is facing scrutiny over its sponsorship of group screenings of “The Assassin(s)” for employees of public institutions, adding to pressure on the brokerage amid controversies over a failed SpaceX stock allocation and single-stock leveraged investment products ahead of the National Assembly’s annual audit slated for later this month.

According to industry officials, the brokerage recently covered the cost of group screenings of the film, which has been accused of distorting history, attended by employees of the Korea Land & Housing Corp. and the Korea Authority of Land & Infrastructure Safety in Jinju, South Gyeongsang Province.

The screenings were organized by the institutions themselves, while Mirae Asset Securities, which manages their retirement pension accounts, paid for the movie tickets.

Regarding this, Lee Jong-bae, a former Seoul city council member from the conservative opposition People Power Party (PPP), filed a complaint with the Seoul Metropolitan Police Agency on Wednesday against Mirae Asset Securities and officials from the two public institutions, alleging violations of the Improper Solicitation and Graft Act.

Lee argued that the sponsorship could "constitute an improper economic benefit if it was provided in return for the institutions' financial dealings with Mirae Asset."

The film is based on the 1974 fatal shooting of Yuk Young-soo, the wife of then-President Park Chung-hee. The film's portrayal of the incident has drawn criticism from conservative politicians over alleged historical distortion.

Mirae Asset Securities denied that the event had any political purpose, saying it was part of its marketing activities for retirement pension customers.

"Group movie screenings for pension customers are part of retirement pension marketing. We will review our guidelines to prevent similar events from causing unnecessary misunderstandings," an official at the brokerage said.

The latest controversy comes as Mirae Asset has seen a sharp increase in consumer complaints following the SpaceX "zero shares" fiasco.

Mirae Asset received 804 complaints in the first half of this year, up 474.3 percent from a year earlier, according to Financial Supervisory Service data.

The complaints came after a failed allocation of SpaceX shares in June left Korean retail investors with no shares despite having subscribed through Mirae Asset.

The brokerage was the only Korean securities firm to participate in the U.S. space giant's initial public offering, but Goldman Sachs, the lead U.S. underwriter, ultimately cut the brokerage's allocation to zero.

Separately, Mirae Asset is at the center of a political dispute over the introduction of single-stock leveraged exchange-traded funds (ETFs) tracking Samsung Electronics and SK hynix. The dispute has emerged as a key issue ahead of the National Assembly’s annual audit, which begins Tuesday and runs through Oct. 30.

Single-stock leveraged ETFs tracking twice the daily returns of the two chip giants were introduced in the Korean market in May, with eight asset management companies launching 16 ETFs and Mirae Asset Securities introducing two exchange-traded notes.

The products have since drawn criticism for amplifying volatility in Korea’s stock market.

The PPP has sought to summon former presidential policy chief Kim Yong-beom, who is believed to have played a key role in the introduction of the leveraged products, and Mirae Asset Group Chairman Park Hyeon-joo as witnesses at the parliamentary audit to examine the process behind their introduction.

However, their effort failed as the ruling Democratic Party of Korea lawmakers led the National Policy Committee's approval of an audit witness list on Thursday that excluded Kim and Park. PPP lawmakers walked out of the meeting in protest.

Rep. Seo Il-jun of the PPP questioned what the ruling party feared. "The parliamentary audit should examine how government policy decisions were made and determine who should be held accountable on behalf of the public," Seo said.

Rep. Shin Dong-uk of the PPP also called for an explanation of "why Kim and Park could not be summoned as witnesses."