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| A legal representative of a group of victims from the latest stock scandal answers questions from reporters in front of Seoul Southern District Prosecutors' Office, Tuesday, ahead of filing a suit against Ra Deok-yeon, a key suspect in the incident. Yonhap |
By Lee Min-hyung
The latest stock scandal, sparked by the abrupt fall of eight listed shares here, is estimated to have incurred a combined loss of more than 8 trillion won ($6.04 billion), affecting mostly retail investors, according to data released by Rep. Yun Chang-hyun's office, Wednesday.
The incident was triggered late last month by the suspicious mass selling spree of some local shares via Societe Generale, a France-based multinational financial services company. The ruling People Power Party lawmaker showed that more than 72,000 retail investors are forecast to have suffered losses of 773 billion won, due to the scandalous fall of the listed shares. When combined with losses from major and institutional shareholders, the figure rises to more than 8 trillion won, according to the data.
Watchdogs are still investigating the case, but the lawmaker criticized them for their weak monitoring efforts regarding the suspicious stock price movements related to the incident.
"Authorities cannot be free from their respective monitoring responsibilities," Yun said. "A number of online stock communities had already detected suspicious stock manipulation signs. The trading environment has changed a lot with the introduction of mobile trading, but authorities' monitoring techniques still belong to the past."
He also admitted that the National Assembly should also be held responsible in part for the recent financial scandal.
"The Assembly will also review how the incident could have happened and come up with countermeasures," the lawmaker said.
Retail investors are launching a class-action lawsuit against the main suspect in the scandal, Ra Deok-yeon, the leader of an investment advisory firm. A total of 66 people, as of Tuesday, filed a suit against Ra. Their combined losses are estimated to surpass 135 billion won.
Ra has been arrested and the prosecution is looking into whether he generated undue revenue by engaging in stock manipulation.
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