[Digital Today Reporter Kang Jin-gyu] The financial authorities have announced that they will block the activities of the undocumented financial investment business at the source. Similar investment advisory companies’ stock reading rooms are blocked.
The Financial Services Commission and the Financial Supervisory Service announced on the 2nd that they will devise and promote measures to strengthen the management and supervision of similar investment advisory companies.
The financial authorities explained that stock reading rooms, which operate on a paid membership basis through online interactive channels, are only allowed for formal investment advisory firms subject to investor protection regulations.
It is said that it allows only official investment advisory companies registered as an investment advisory business to view stock reading rooms operated on a paid membership basis through an online two-way channel. In fact, similar investment advisory companies’ stock reading rooms are prohibited.
The financial authorities announced that they would raise awareness of illegal business by investors and similar investment advisors and prevent damage by reinforcing guidance on typical illegal types such as stock reading rooms, copy trading, and artificial intelligence (AI) automatic trading.
In addition, the financial authorities are planning to immediately clarify that private broadcasting such as YouTube, which receives direct compensation from investors such as paid membership system, is subject to reporting as a similar investment advisory business. Considering that the legal interpretation has been unclear so far, a guidance period (three months) for reporting is granted until the end of July.
The management of entry, sales, and exit of similar investment advisory companies will also be strengthened. For false reports, the same grounds for punishment will be prepared as for non-reporting, and the business method will be subdivided in the report form so that the business status can be grasped through the report data.
In addition, the company plans to specify services that similar investment advisors cannot provide and the possibility of an investor’s loss of principal in advertisements and services. In addition, the company plans to actively expel ineligible companies by expanding the reasons for ex officio expiration due to violations of the Capital Act, the Door-to-Door Sales Act, and the E-Commerce Act more than twice over five years.
The Financial Supervisory Service and the Korea Exchange plan to significantly expand the scale of the Amhaeng inspection by integrating the stock reading room Amhaeng inspection. In addition, if an unregistered advisory or discretionary business of a similar investment advisory business is detected, it will request the Korea Communications Commission to block the site of the business.
An official from the financial authority said, “When the system is completed, the use of online interactive channels by similar investment advisors will be blocked, and it will be easier to inspect and crack down on illegal advice.” “It will also be possible to eradicate the behavior of deluding investors through advertising.”
Author/ Translator: Jamie Kim
Bio: Jamie Kim is a technology journalist. Raised in Hong Kong and always vocal at heart. She aims to share her expertise with the readers at blockreview.net. Kim is a Bitcoin maximalist who believes with unwavering conviction that Bitcoin is the only cryptocurrency – in fact, currency – worth caring about.