Korea’s financial regulator on April 9 launched a special inspection into Samsung Securities over the brokerage’s “fat-finger” trading chaos, which saw non-existent stocks paid to its employees as dividends.
The firm had been planning to pay cash dividends of 1,000 won (US$0.93) to its employees on April 6. However, the firm mistakenly deposited 2.8 billion stocks as dividends.
The firm’s shares tumbled as some employees unloaded the stocks.
|Financial Supervisory Service vice governor Won Seung-yeon|
In a statement, the Financial Supervisory Service called the dividend chaos at Samsung Securities a “big financial incident that significantly undermines the safety of and trust in capital markets.”
The dividend error showed “grave moral hazard” and was a “serious problem” for the brokerage‘s trading system, the FSS said.
The FSS will carry out the on-site inspection at Samsung Securities until April 19 and will closely look into the brokerage’s trading system.
It will also inspect whether the brokerage is taking measures to compensate ordinary investors who may have been affected by the mistake, the FSS said.
By Lee Ji-yoon and newswires (firstname.lastname@example.org)