The Financial Supervisory Service's special judicial police for the capital market will now be able to launch investigations into its own cases without filing a complaint with or notifying prosecutors.
The Financial Services Commission said on the 15th that it approved and immediately put into effect a revision to the "Rules on Duties of Special Judicial Police for the Capital Market" reflecting these changes.
Under the revision, among cases being examined by the Financial Services Commission (FSC) or the Financial Supervisory Service (FSS), if there is substantial suspicion of a crime and concern about destruction of evidence, the case may be converted to an investigation without a separate complaint after review by the Investigation Review Committee.
As a result, cases detected during the examination stage can be handed over directly for investigation. The move is expected to reduce the delays that used to occur between examination and investigation, curb the risk of evidence being destroyed, and improve the speed of investigations.
The system for the Investigation Review Committee that decides whether to convert a case to an investigation was also overhauled. The composition of members was revamped to include the head of the FSS investigation department and a legal advisor, while excluding civilian members who had belonged to the existing Capital Market Investigation Review Committee to maintain confidentiality of examinations and investigations.
The requirements for convening the committee were clarified so that it can be called at the request or with the consent of two or more Commissioners, or at the discretion of the Chairperson, strengthening the efficiency of the review process.
However, concerns have been raised that the FSS's authority could expand excessively. Critics noted that if the FSS, a private institution, abuses its investigative powers, there are insufficient mechanisms to rein it in.
An official at the Financial Services Commission (FSC) said, "Once a case passes only through the Investigation Review Committee, it will become possible to convert all examination cases into investigations, enabling a swift and stern response to capital market crimes such as unfair trading," adding, "We plan to establish detailed operating guidelines to ensure the system takes root."