SEOUL, South Korea’s financial regulator said Tuesday that it will inspect all global investment banks (IBs) in the country to check their stock short selling practices.
The Financial Supervisory Service (FSS) said it will form a new special task force to this end.
“(FSS) will thoroughly hold accountable those engaged in customary practice of illegal short selling by inspecting all IBs, so that there will no longer be any naked short selling,” it said in a press release.
The move comes after the FSS exposed two Hong Kong-based IBs here that allegedly have been engaged in illegal short selling for what the financial regulator called an extended period of time.
“We will work to restore market confidence by taking stern action against any illegal short selling exposed by our (upcoming) inspection and improving our system to prevent illegal short selling in the future,” the press release said.
The special investigation team will consist of 20 FSS officials.
Many of them will have vast experience in investigation and will be fluent in English, according to the FSS.
“(FSS) will allocate sufficient resources and personnel to enable the swift and effective investigation of foreign investors,” it said.
Source: Yonhap News Agency