South Korea indicts Bnp Paribas for illegal short selling
Following the financial authorities' fine of more than 20 million to the French institution and Hsbc, South Korean prosecutors indicted the former for allegedly violating short selling rules
by L.Ca
2' min read
2' min read
South Korean prosecutors indicted Bnp Paribas SA for allegedly violating the rules on short selling. Sources close to the parties tell Bloomberg.
The French bank was, in fact, accused last week of violating the Capital Markets Act. The transactions of the global investment bank that were the subject of the indictment allegedly took place between September 2021 and May 2022 with a value of 18 billion won (USD 13 million). According to the prosecution, the traders allegedly repeatedly engaged in violations of short selling rules over 'a long period'. Both Bnp Paribas and the prosecutor's office had no official comment.
However, Regal Funds Management Pty Ltd., one of Australia's largest hedge funds, had said last week that it and a former employee had been indicted for an alleged breach of securities trading regulations in 2019. Regal has denied the allegations and is considering his position under South Korean law.
The prosecutors' charge came after Bloomberg News reported last December that Korean financial regulators had imposed a total fine of 26.5 billion won (over $20 million) on Bnp Paribas, its domestic brokerage unit and Hsbc Holdings Plc for short selling. Hsbc's Hong Kong unit and three of its traders were indicted by Korean prosecutors on charges of illegal short selling in March.
The financial sector has come under closer scrutiny in Korea since the Asian country banned short selling on its stock market a year ago. Banks, including Credit Suisse Singapore Ltd. as well as hedge funds such as Segantii Capital Management Ltd. and Jane Street Group LLC, have also faced investigations and fines as a result of the 'crackdown'.
