On the 3rd, Chairperson Lee Eog-weon said, "We will significantly raise the cap on rewards for reports of unfair trading and the like, and will consult with relevant ministries on plans to create a separate fund financed by ill-gotten gains and other sources to expand rewards in proportion to those gains."
At a congratulatory address at the "KOSPI 5000 and Beyond Seminar" held at the Korea Exchange (KRX) that day, the chairperson said, "We will strengthen voluntary insider reporting incentives, which stock manipulation rings fear most and which are the most effective." The Financial Services Commission (FSC) plans to review measures to expand reward amounts by overhauling the entire reward system for reporting unfair trading and accounting fraud.
A day earlier, Presidential Chief of Staff Kang Hoon-sik said, "Even if you tip off stock manipulation worth hundreds of billions of won, the maximum reward in Korea is only 3 billion won," and asked, "Please review effective institutional improvements." Kang also mentioned cases in which the U.S. Securities and Exchange Commission (SEC) pays whistleblowers up to 30% of ill-gotten gains in cases involving fines or a penalty surcharge of $1 million or more. The financial regulator presented a specific response plan just one day after Kang's remarks.
Under the rules, rewards paid to reporters of unfair trading are calculated by considering the case's base amount and contribution rate. The total assets of the stocks mobilized for stock manipulation and the size of the ill-gotten gains must be large, and there must be many accusers. The maximum reward of 3 billion won is paid only when all these conditions are met. The maximum reward for reporting accounting fraud is 1 billion won.
However, even after reporting unfair trading and the like, it is not easy to qualify for rewards, and the criteria for calculating rewards are stringent, so the total rewards paid so far have remained at the level of hundreds of billions of won.
In addition, the chairperson said, "We will establish a system in which ordinary shareholders are robustly protected and shareholders rightfully enjoy the fruits of corporate growth," and emphasized, "We will support corporate innovation so that companies investors want to invest in continue to emerge on our stock market."