Samsung Securities trio get suspended sentence

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Samsung Securities trio get suspended sentence

A Seoul court on Wednesday meted out suspended prison terms to three Samsung Securities employees and slapped five others with fines for selling “ghost” stocks mistakenly issued by the company in the massive fat-finger error that jolted the market last year.

The Seoul Southern District Court sentenced a 38-year-old surnamed Koo and a 35-year-old Choi to 18 months in prison, suspended for three years.

It also sentenced another employee surnamed Lee to one year in prison, suspended for two years.

Five others, including a 46-year-old surnamed Ji, were ordered to pay fines of between 10 million won ($8,770) and 15 million won.

The court denounced the defendants’ misdeeds as a crime that deserves punishment since they have betrayed their own professional ethics and public trust.

Yet it took into account that the blunder was primarily a result of the company’s erroneous system and a pure mistake by one of the employees, the court said. It also noted that the defendants acted irrationally and that their stock sales didn’t actually make any returns.

The eight were indicted in July last year for fraudulent trading and other charges.

The probe centered on an April 6 stock blunder, in which an official at the Samsung brokerage firm mistakenly typed in 1,000 shares instead of 1,000 won per share for dividends that were to be paid to employees under a company compensation plan.

As a result it issued 2.8 billion shares that only existed on paper, worth over 110 trillion won.

Koo and two others who have been arrested are suspected of unloading their holdings, worth between 20 billion won and 51.1 billion won, over a dozen different transactions.

The sale of ghost shares incurred some 9.2 billion won in losses for Samsung Securities, the prosecutors said earlier. The Financial Supervisory Service has fined the company 144 million won over the error.


Yonhap

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