Financial Watchdog to Probe Short Selling

The Financial Supervisory Service will investigate short selling of stocks and other activities creating financial jitters resulting in plunging share prices and a weaker won.

The financial watchdog`s chief Kim Jong-chang in a news conference yesterday also warned against profiteering from illegal stock trading or the spread of malicious rumors.

“Rumors have spread that currency traders are conducting illegal stock trading. We have closely watched their activities and will thoroughly consider whether to launch an investigation,” he said.

Activities regulated by Korean financial authorities include the intentional spread of rumors by stock traders, front running and stock trading in excessively large volumes.

jarrett@donga.com