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Photo = FSS |
[Alpha Biz= Paul Lee] Three asset management firms have been fined a total of over 100 million KRW by the financial authorities for failing to comply with public disclosure obligations related to voting rights in the stocks they held in funds.
According to the financial investment industry on Tuesday, the Financial Supervisory Service (FSS) imposed a total fine of 108 million KRW on Paros Asset Management, Moda Asset Management, and Lee Hyun Asset Management this month. All three firms failed to disclose reasons for not exercising voting rights on stocks held in their funds.
Paros Asset Management was fined 72 million KRW and received a "warning for illegal or inappropriate matters" against one retired employee. Moda Asset Management was fined 24 million KRW and received the same warning for a retired employee. Lee Hyun Asset Management was fined 12 million KRW and received a cautionary notice for one executive.
According to the FSS, collective investment businesses are required to disclose whether they exercised their voting rights on stocks in their portfolios or explain why they did not. However, all three firms failed to meet this disclosure obligation.
Paros Asset Management, for example, failed to disclose that it did not exercise voting rights on shares in nine companies held by 13 funds, despite missing the disclosure deadline three times. Moda Asset Management and Lee Hyun Asset Management also failed to disclose the reasons for not exercising voting rights on stocks within the specified timeframe.
As a result, industry experts have pointed out that financial authorities need to focus more on regulating the legal violations of smaller asset management firms. The FSS had previously provided guidance last year stating that firms must disclose whether they exercised voting rights on stocks issued by companies held in their funds.
Alphabiz Reporter Paul Lee(hoondork1977@alphabiz.co.kr)
