[DigitalToday reporter Sangyeop Oh] The Financial Services Commission's Securities and Futures Commission said on Tuesday it held its fifth regular meeting and filed a complaint with prosecutors against 11 people and 4 related companies linked to the "Joint Response Team Case No. 1" that allegedly organised stock price manipulation by mobilising more than 100 billion won in funds.

Those reported include a wealthy individual who operates a general hospital and a large private academy, as well as financial professionals such as an asset management firm executive and a financial company branch manager, and a minority shareholder activist.

They are suspected of violating prohibitions on price manipulation and unfair trading under the Capital Markets and Financial Investment Services Act.

Investigators found they selected DI Dongil, which has low daily trading volume, as the target for manipulation and injected more than 100 billion won, including corporate funds and loans from the financial sector, to take control of a substantial share of shares in circulation.

The suspects' buy orders accounted for about one third of the overall market. They were found to have manipulated the share price over a long period and lured investors using tactics such as buying at high prices, placing bogus orders and influencing opening and closing prices.

They also pressured management under the pretext of a minority shareholder campaign to sign a treasury stock acquisition trust contract with Securities Firm A. Through internal personnel they had drawn in, they caused buy orders from the trust account to be submitted as they intended, abusing the treasury stock trust to manage the share price. During this process, the suspects realised gains by selling some of their holdings at high prices.

They were expanding the scheme beyond DI Dongil to another stock with similar characteristics (Stock C) when the Joint Response Team's search and seizure and an abrupt "payment suspension" measure halted the unfair trading, it found.

The FSC said, "The payment suspension measure and search and seizure halted ongoing criminal activity and prevented the scale of damage from spreading," and "It is significant in that we identified additional unfair trading and, for the first time, implemented a payment suspension measure to secure resources to recover illicit gains."

The Joint Response Team plans to actively cooperate with the prosecution investigation so the case can become an example that "stock manipulation leads to ruin."

It also plans to respond strictly by actively applying the "one strike out" system, including imposing penalties of up to twice the amount of illicit gains and restricting trading in financial investment products and appointment as an executive.