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The Korea Herald
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THE INVESTOR
March 29, 2024

Finance

FSC penalizes Samsung Securities for ‘fat-finger’ error

  • PUBLISHED :July 27, 2018 - 11:10
  • UPDATED :July 27, 2018 - 13:17
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[THE INVESTOR] Korea’s financial regulator on July 27 ordered Samsung Securities to suspend part of its operations for six months as punishment for its dividend payout error, while taking action against top executives and levying a fine.

The brokerage firm has been ordered to suspend services to new investors for six months, the Financial Services Commission said in a statement. 




Samsung Securities said it expects to suffer a loss of at least 8.1 billion won (US$7.22 million) or 0.18 percent of its sales recorded in 2017 due to the suspension.

The FSC also ordered CEO Koo Sung-hoon to stay off his duties for three months. Eight other executives of Samsung Securities were reprimanded and a fine of 144 million won was also slapped on the firm, according to the statement.

The brokerage came under criticism when it accidentally issued non-existent 2.8 billion stocks to employees on April 6, instead of paying 2.8 billion won in cash dividends under its stock ownership plan. Despite being issued a warning, some 16 employees immediately sold off 5 million shares, worth about 200 billion won. The incident has raised concerns about the company’s internal system and moral hazard among its workers.

By Park Ga-young (gypark@heraldcorp.com)

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