Penalties for mis-selling are being toughened to include fines up to 30 million won and pubitive fines up to 50 percent of unfair gains. New standards for professional investors also established.
Korea has passed new legislation establishing a legal basis for the operation of P2P lending businesses and the regulatory oversight role of the FSC and FSS.
The new legislation will strengthen the management and supervision of financial benchmarks and their administrators, the FSC said.
The legislative revision to implement the ARFP in Korea will take effect after six months, and will allow Korean funds to be eligible for offer in other member economies.
Initially, bank customers will be able to access services from 10 banks, before the system is expanded to other banks and fintech firms in December.
The FSS will conclude its investigation into KEB Hana and Woori Bank this week. KEB Hana and its CEO are expected to face higher penalties for 'obstructing' the investigation.
FSS data shows that JP Morgan Chase and Société Générale earned nearly $6.8mn from the high-risk derivatives products sold through KEB Hana and Woori Bank.
On top of the higher penalties for illegal short selling, the FSC will penalise violators extra if they are found to have also engaged in unfair dealing.
Large brokerage firms will be allowed to extend loans to their overseas operations to better finance their global outreach.
The loan-to-deposit rate at savings banks will be limited to 110% starting from 2020, and further tightened to 100% in 2021. Currently, commercial banks already face the 100% limit.