Hyundai's Lee Ik-chi Suspected of Insider Trading

The Financial Supervisory Service (FSS) is looking into allegations that Hyundai Securities Chairman Lee Ik-chi illegally bought Hyundai Securities stock before Hyundai Investment Trust & Securities Company commenced a plan to attract foreign investment from American International Group (AIG).

"In early June," explained an FSS source August 24, "Chairman Lee and 44 executives of Hyundai Securities applied for purchases of their own company's stock, rationalizing that the stock price of Hyundai Securities had sunk too low; the FSS consequently approved the purchase.

"Soon after Chairman Lee purchased the stocks on June 19, however, Hyundai Securities announced their plan to attract foreign investment. The stock price of Hyundai Securities subsequently skyrocketed.

"Because it was possible that Chairman Lee and other Hyundai Investment Trust & Securities executives had knowledge of the strategy prior to their purchases," continued the FSS source, "the FSS has been investigating the possibility of insider trading."

Chairman Lee and the 44 Hyundai Securities executives purchased their shares at 9,521 won. After the disclosure of the plan to attract AIG's investment, the stock shot up to 13,000. As of August 24, the price has fallen to 10,950 won.

by Jung Kyong-min