Leveraged ETFs Spark Market Volatility Controversy, Senior South Korean Presidential Official Faces Criminal Charges
TechFlow news, August 03, according to South Korea's "JoongAng Daily", South Korean Presidential Office Policy Chief Kim Yong-beom has been accused of abuse of power, coercion, and obstruction of business for allegedly promoting the listing of leveraged ETFs linked to single semiconductor stocks, and relevant criminal reports have been formally submitted. These single-stock leveraged ETFs are believed to have exacerbated market volatility and caused investors to suffer billions of dollars in losses. Lee Jong-bae, a conservative former Seoul city councilor supported by the opposition People Power Party, stated that he submitted a criminal lawsuit against Kim Yong-beom to the Supreme Prosecutors' Office through the government's online petition system on Monday.
Lee Jong-bae believes that Kim Yong-beom actually instructed financial regulatory authorities to consider launching leveraged ETF products linked to single chip stocks. Lee Jong-bae also claimed that the South Korean Financial Services Commission (FSC) has been internally reviewing a plan since January, aiming to establish the necessary regulatory framework and system in the second quarter, and then launch these products in the second half of the year. Lee Jong-bae stated: "Without Kim Yong-beom's instruction, financial regulatory authorities would not have rushed to launch leveraged ETFs linked to single semiconductor stocks on the eve of the election, disregarding serious market risk warnings." (Jin10)
