Troubles may increase for France's multinational universal bank and financial services company BNP Paribas SA in Korea. South Korean prosecutors have charged the company with violating short selling rules. Bloomberg has given this information quoting sources. Strictness is being imposed to curb such trades in South Korea. This step has been taken in this direction. The source, on the condition of anonymity, has informed that this step has been taken against the French bank on charges of violating local rules regarding capital market last week.

 

The Seoul Southern District Prosecutors' Officer this month charged a global investment bank and a global hedge fund with illegal short selling. The names of these two have not been released. However, Regal Funds Management, one of Australia's largest hedge funds, said last week that it had been charged with violating securities trading regulations in 2019. Regal has denied the allegations and said that it is considering its rights under South Korean law. At present, no response has been received from any side in this matter.

Bloomberg had reported in December that Korea's financial regulator had fined BNP Paribas, its brokerage unit in Korea and HSBC Holdings $19 million. This fine was imposed on charges of Naked Short Selling. Strictness has increased regarding the financial industry in Korea. Banks like Credit Suisse Singapore, hedge funds like Segantii Capital Management Ltd. and Jane Street Group LLC are also facing investigations and fines. Korea has tightened its grip on short selling only last year. However, the regulators have indicated that they may lift the restrictions by the end of March and will also make necessary changes in the rules to control short selling.