KB Securities was sanctioned by the financial authorities for multiple legal violations, including failing to register credit information and breaching approval procedures for over-the-counter derivatives.
On the 21st, the Financial Supervisory Service said it issued an institutional caution to KB Securities for violations including failure to register credit information and breaches of approval procedures for over-the-counter derivatives, and imposed an administrative fine of 215.6 million won.
Sanctions were also imposed on employees. Status penalties included one pay cut, three reprimands, and two cautions, and cautionary measures equivalent to warnings were applied to seven former employees.
According to the Financial Supervisory Service (FSS), from Jan. 2021 to Nov. 2025, KB Securities failed to register with the consolidated credit information agency the credit information that must be registered, including 243 loans to corporations, 181 cases of debt guarantees and debt assumption, and 14 items of corporations' arrears information.
In addition, from 2021 to 2025, while conducting 2,168 over-the-counter derivatives transactions, including equity swaps, it did not obtain approval from the derivatives business officer, and it violated regulations by failing to report the status of foreign-currency securities investments to the Financial Supervisory Service (FSS) a total of 18 times.
Also uncovered were delays in disclosing business reports; violations of the duty to confirm explanations when selling financial investment products; violations of the duty to ensure the safety of electronic financial transactions by failing to properly de-identify some customer information during development; and violations of the duty to notify changes to electronic financial transaction terms and conditions.
Some employees recommended ultra-high-risk products before assessing investors' risk profiles or sold them without updating risk profile information, and there were also instances of improper solicitation, such as explaining products with possible principal losses as if there were no principal losses.