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Hyundai executives to be investigated for insider trading

By Nam Gyeong-sik, UPI News Korea
Twelve high-ranking executives at Hyundai Motor are being investigation on allegations of using undisclosed information about cooperation with Apple to avoid loss in the stock market. Photo courtesy of Hyundai Motor
Twelve high-ranking executives at Hyundai Motor are being investigation on allegations of using undisclosed information about cooperation with Apple to avoid loss in the stock market. Photo courtesy of Hyundai Motor

SEOUL, April 14 (UPI) -- A dozen executives from South Korea's Hyundai Motor are under investigation into whether they profiteered from insider information earlier this year.

The country's financial regulators said Sunday that after two-month probes, the Korea Exchange had decided to pass the case on for a further, full-fledged investigation.

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On Jan. 8, media reports boosted Hyundai's share prices after rumors surfaced that Apple approached the Seoul-based company to collaborate on electric vehicles.

At the time, Hyundai said it was in talks with multiple companies for electric cars. As a result, its stock price jumped some 30 percent for two trading days.

However, one month later, Hyundai denied a partnership with Apple, causing a slip of more than 6 percent in the Korean bourse. Before that, Hyundai executives sold off 3,402 company shares, generating suspicions that they might take advantage of undisclosed information.

Rep. Park Yong-jin from the ruling Democratic Party of Korea first took issue with the move during a parliamentary session in mid-February.

"Thinking the case is unfair, people are angry about inappropriate profiteering. The financial authorities are required to deal with this problem immediately," the lawmaker said.

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In response, Financial Services Commission Chairman Eun Sung-soo promised that the financial watchdog would take any appropriate measures.

Either the FSC or its enforcement arm, the Financial Supervisory Service, is expected to carry out the investigation, which would take about six months.

"Insider trading is illegal, regardless of the number of shares involved," Daelim University automotive professor Kim Pil-soo told UPI News Korea. "But the overall quantity at issue is not so big. Hence, I am not sure how the financial regulators will conclude."

Hyundai Motor officials declined to comment.

The automaker's shares were up 1.77 percent on Tuesday, while the benchmark KOSPI rose by 1.07 percent.

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