South Korean Presidential Office Official Faces Criminal Charges for Allegedly Pushing Leveraged ETFs

Odaily News - According to South Korea's JoongAng Ilbo, Kim Yong-beom, chief of the policy office at the South Korean presidential office, has been accused of abusing authority, coercion, and obstructing business for allegedly pushing for the listing of leveraged ETFs tied to individual semiconductor stocks. A related criminal complaint has been formally filed. These single-stock leveraged ETFs are believed to have exacerbated market volatility and led to investor losses amounting to billions of dollars.

Lee Jong-bae, a conservative former Seoul city councilor backed by the opposition People Power Party, said he submitted a criminal complaint against Kim Yong-beom to the Supreme Prosecutors' Office on Monday through the government's online petition system. Lee believes that Kim effectively instructed financial regulators to consider launching leveraged ETF products linked to individual chip stocks.

Lee also claimed that the Financial Services Commission (FSC) has been internally reviewing a plan since January aimed at establishing the necessary regulatory framework and systems in the second quarter, before launching these products in the second half of the year. Lee stated: "Without Kim Yong-beom's instructions, financial regulators would not have rushed to launch leveraged ETFs tied to individual semiconductor stocks on the eve of the election, despite serious warnings about market risks." (Jinshi Data APP)