Updated : 2015-08-18 17:53
Regulator raids accountant for allegedly using inside information
By Kim Jae-won
The financial regulator said Tuesday that its officials raided an accountant’s house, and searched his car and cell phone because he allegedly traded stocks using inside information. It is the first time in 13 years that the Financial Services Commission (FSC) exercised its authority to raid people suspected of committing financial crimes. “Officials from our Capital Market Investigation Team raided an accountant’s belongings, including his cell phone, as he was suspected of using inside information for stock investments,” said an official of the FSC, asking not to be named.
The official said the investigators found evidence of the illegal practice through his cell phone by uncovering documents he erased, in cooperation with the prosecutors’ office.
He refused to reveal the name of the accounting firm which the accountant works for, referring to the ongoing investigation. Market watchers said he works for one of the nation’s four largest accounting firms ― Samil PwC, Samjong KPMG, Deloitte Anjin and EY Hanyoung.
The FSC said that the regulator will use its authority to raid people suspected of financial crimes more often to show its determination to crack down on such cases. The FSC is given the authority to do so with an approval from a court by the law, but has not exercised this for the last 13 years due to a lack of manpower.
However, it launched a capital market investigation team recently with some 20 officials and is gearing up to flex its muscles in fighting financial crimes.
“They are working hard, but keeping their performance secret,” said the FSC official.
The regulator said that the FSC is focusing on checking abnormal flows while its executive body, the Financial Supervisory Service, is examining labor-intensive works, such as tracking the bank accounts of suspects.
The FSC said that foreign securities regulators, including the U.S. Securities and Exchange Commission, have similar authority to raid suspects. It said it is also watching carefully the movements of funds in the capital markets to determine whether there are any illegal practices. The Korea Exchange also reports such cases regularly to the regulator.
Market watchers said that the FSC has enforced its authority since its chairman, Yim Jong-yong, took the helm earlier this year. Yim has pushed for reforming the finance industry, saying it lags behind its global competitors.