Posted December. 10, 2004 22:21,
The Fair Trade Commission (FTC) is investigating 17 affiliates of the three major groups of Lotte, Kumho Asiana, and Dongwon.
The FTC announced on Friday that it started investigation into some affiliates of the three groups, whose suspicion of illegal insider trading had been disclosed. A total of 17 affiliatessix for both Lotte and Kumho Asiana and five for Dongwonare under the probe.
As for Lotte Group, Lotte Hotel, Lotte Shopping, Lotte Card, Lotte Capital, Honam Petrochemical Corp., and Korea Severn are being examined.
The FTC is now finding out whether Lotte Groups affiliates were involved in illegal insider trading in Lotte Capitals capital increase with consideration. It is also probing charges that Lotte Groups affiliates in the distribution industry favored each other with regard to product prices and trade terms.
It is also known that suspicion of illegal insider trading in the process of the Lotte Department and Lotte Card merger is being investigated.
The FTC did not comment on specific charges of Kumho Asiana and Dongwon Group.
We introduced a regular monitoring system in February on illegal insider trading of large corporations, instead of collectively investigating five or 10 major groups that are selected by asset volume. We have monitored corporate disclosures since then, said a FTC official. Investigations are underway, so it is too early to comment on specific charges and whether or not they violated laws.
As for some viewpoints stating that the FTC is pressing the business sector that has been against the revision of FTC rules, another FTC official said, We are just conducting investigations on groups whose charges have been uncovered as a result of our regular monitoring. It has nothing to do with the revision of FTC rules.
The FTC announced that it would wrap up the investigation within this year.
We have been under examination for two weeks, said an interest of Lotte Group. We are not suspicious of any illegal insider trading, it is just a regular probe since we have not been investigated for the past five years.
Kumho Asiana said, Several affiliates are under probe, but we do not know about the specific charges.