Good Morning Is Warned On Stock Recommendation

Stock-market regulators Thursday issued a warning to a local brokerage house for allegedly cheating investors with an investment recommendation.

The Korea Securities Dealers Association said that Good Morning Securities Co. recommended a stock listed on the Kosdaq market through its daily and monthly market reports, after buying 27,000 shares of the issue from Feb. 22 to Feb. 27.

Then, the association said, the brokerage firm sold the shares from last Thursday to Monday, earning 33 million won ($25,741) on the sale.

Good Morning explained that the sale was an "independent" decision.

Good Morning is the first securities company to be issued such a warning, although there have been occasions in which other securities firms issued a "buy" recommendation, before massive "sell" orders were placed through company accounts. The watchdog association said that it did not sanction Good Morning because the sale was made during a "guidance period."

Beginning next month, however, the organization will crack down on "unfair" activities by brokerage firms, said an official at the group. "Perpetrators will be investigated and will be sanctioned."

by Kim Hyun-chul