Most Popular
-
1
Heavy snow alerts issued in greater Seoul area, Gangwon Province; over 20 cm of snow seen in Seoul
-
2
Seoul blanketed by heaviest Nov. snow, with more expected
-
3
Seoul snowfall now third heaviest on record
-
4
Samsung shakes up management, commits to reviving chip business
-
5
Heavy snow of up to 40 cm blankets Seoul for 2nd day
-
6
How $70 funeral wreaths became symbol of protest in S. Korea
-
7
Seoul's first snowfall could hit hard, warns weather agency
-
8
Why cynical, 'memeified' makeovers of kids' characters are so appealing
-
9
Hybe consolidates chairman Bang Si-hyuk’s regime with leadership changes
-
10
BOK makes surprise rate cut to lift growth
South Korea's antitrust watchdog said Sunday it has decided to fine 20 local securities firms a combined 19.2 billion won ($17.6 million) for colluding to fix rates on some small-denomination bonds.
The Fair Trade Commission also said it plans to lodge a complaint with the prosecution against six securities firms, including industry leader KDB Daewoo Securities, which are viewed as being deeply involved in the rate-fixing.
Korean consumers are required to buy small bonds including national housing bonds when buying homes or autos and usually sell those debts to banks. The securities firms took profits by buying the bonds at below-market prices after rigging the rates between 2004 and 2010, according to the FTC.
"The punitive action will help ease burdens for small bond buyers as the securities firms won't be able to artificially set the yields for such debts," said a senior official at the FTC.
The move is likely to deal a blow to local brokerages which are also under investigation by the FTC over alleged collusion to rig rates on certificates of deposit (CDs), a key money-market rate for mortgage lending.
Since mid-July, the FTC has been investigating major local banks and an unspecified number of brokerage houses over their suspected involvement in fixing rates on 91-day CDs after their yields stayed flat for almost three months from March.
Local brokerage houses said the practice mainly came about after the government advised them to reduce the yield spreads of treasuries and national housing bonds in 2004 when quoting the rates on the small bonds.
"The bourse operator and the financial watchdog have never taken issue with such a practice," said an official at a brokerage house, asking not to be named.
Market watchers said if a local court levies punishments harsher than fines for the six securities firms, they will not be allowed to expand into doing new business for three years or to set up affiliates for five years, under the capital market law.
A consumer advocacy group said it will lodge a class action suit against the securities firms as their collusion led them to take profits worth more than 400 billion won, inflicting damage on consumers.
"By capitalizing on their superior position, the securities firms colluded to rig rates and made excessive profits, which is tantamount to exploitation of consumers," said the Korea Finance Consumer Federation.
(Yonhap News)
The Fair Trade Commission also said it plans to lodge a complaint with the prosecution against six securities firms, including industry leader KDB Daewoo Securities, which are viewed as being deeply involved in the rate-fixing.
Korean consumers are required to buy small bonds including national housing bonds when buying homes or autos and usually sell those debts to banks. The securities firms took profits by buying the bonds at below-market prices after rigging the rates between 2004 and 2010, according to the FTC.
"The punitive action will help ease burdens for small bond buyers as the securities firms won't be able to artificially set the yields for such debts," said a senior official at the FTC.
The move is likely to deal a blow to local brokerages which are also under investigation by the FTC over alleged collusion to rig rates on certificates of deposit (CDs), a key money-market rate for mortgage lending.
Since mid-July, the FTC has been investigating major local banks and an unspecified number of brokerage houses over their suspected involvement in fixing rates on 91-day CDs after their yields stayed flat for almost three months from March.
Local brokerage houses said the practice mainly came about after the government advised them to reduce the yield spreads of treasuries and national housing bonds in 2004 when quoting the rates on the small bonds.
"The bourse operator and the financial watchdog have never taken issue with such a practice," said an official at a brokerage house, asking not to be named.
Market watchers said if a local court levies punishments harsher than fines for the six securities firms, they will not be allowed to expand into doing new business for three years or to set up affiliates for five years, under the capital market law.
A consumer advocacy group said it will lodge a class action suit against the securities firms as their collusion led them to take profits worth more than 400 billion won, inflicting damage on consumers.
"By capitalizing on their superior position, the securities firms colluded to rig rates and made excessive profits, which is tantamount to exploitation of consumers," said the Korea Finance Consumer Federation.
(Yonhap News)
