A ruling ordering NH Investment & Securities, which sold Optimus funds, to compensate OTOKI 7.5 billion won for losses from investing in the fund has been finalized.
The Supreme Court's Third Division (Presiding Justice Oh Seok-jun) said on the 20th that it finalized a lower court ruling on Nov. 9 that said, in OTOKI's unjust enrichment suit against NH Investment & Securities, "NH Investment & Securities shall pay OTOKI 7.55 billion won."
NH Investment & Securities previously signed a consignment sales contract with Optimus Asset Management and sold private equity fund products. Optimus told NH Investment & Securities that the fund generated revenue by investing in accounts receivable arising from construction projects ordered by government-affiliated agencies and public institutions. Optimus in fact invested the pooled money in risky asset, and in June 2020 the "Optimus crisis" unfolded, causing investors heavy losses.
OTOKI, at the recommendation of NH Investment & Securities, invested 15 billion won in Feb. 2020 but suffered losses due to a redemption delay. It then filed suit in June 2021 seeking the return of unjust enrichment.
In the first trial, the court accepted OTOKI's claims, canceled the fund contract, and ordered NH Investment & Securities to return the entire 15 billion won investment. The appeals court also recognized NH Investment & Securities' liability for damages but limited responsibility to 60%. Accordingly, the compensation was set at 7.55 billion won, equal to 60% of the 12.58 billion won in investment principal that OTOKI has yet to recover.
The appellate court determined that while there was no remaining profit related to OTOKI's investment at NH Investment & Securities, the firm was liable for damages for breaching its "duty to protect investors" as an investment broker. That was because, despite considerable grounds for doubt in the investment prospectus provided by Optimus regarding the revenue structure, investment targets, and the feasibility of realizing profits, it recommended the investment without sufficient review.