It is known that the Financial Supervisory Service has notified NH Investment & Securities CEO Chung Young-chae of a’three-month suspension of work’ in relation to the Optimus incident.
According to the financial investment industry on the 2nd, the FSS will open a sanction review committee on NH Investment & Securities, the largest seller of Optimus funds, the Korea Securities Depository, and Hana Bank, a trustee, on the 18th. Prior to this, the Financial Supervisory Service notified CEO Jeong of a three-month suspension of work in advance last week. It is the responsibility that NH Investment & Securities sold to investors without properly filtering out the insolvent funds managed by Optimus Asset Management.
The level of sanctions on financial company executives is divided into five stages:’recommendation of dismissal-suspension of work-reprimand warning-cautious warning-caution. The suspension of duties that CEO Jung received was the second most serious measure after the recommendation of dismissal during the disciplinary action against financial company executives. If the suspension of his job is confirmed, CEO Chung will be restricted from reemployment or re-employment in the financial sector in the future.
It is known that NH Investment & Securities has also been notified of institutional disciplinary action, which corresponds to severe disciplinary action, and KSD and Hana Bank have received prior notice of severe disciplinary measures such as’institutional warning’. Hana Bank Chairman Ji Sung-gyu and Depository President Lee Myung-ho were excluded from disciplinary action. Only employees in charge of Optimus-related work were notified of sanctions, such as reductions in salaries.
However, the content notified by the Financial Supervisory Service in advance is not a final measure, so the level of sanctions may be adjusted during the sanction review stage in which external members participate. The sanctions deliberation is conducted in a large-election system in which the person subject to the sanctions attends and presents rebuttal opinions. After that, it must also go through a resolution by the Securities and Futures Commission and the Financial Services Commission.
Meanwhile, NH Investment & Securities’ Optimus Fund sales amounted to 432.7 billion won, which is 84% of the total redemption suspension.
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