Lee Eok-won and Lee Chan-jin apologize again over single-stock leveraged ETF losses: “Heavy-hearted, sorry to the public”

[Financial News] Financial Services Commission Chairman Lee Eok-won and Financial Supervisory Service Governor Lee Chan-jin apologized again over losses suffered by investors in single-stock leveraged exchange-traded funds (ETFs). At the National Assembly, criticism continued that the circumstances surrounding their introduction and responsibility for them had not been clearly established, despite individual investors’ losses exceeding 6 trillion won.
At a comprehensive audit by the National Assembly’s National Policy Committee on the FSC, FSS and other bodies on the 22nd, Lee said, “I feel very heavy-hearted that, despite the various policy needs and rationale for introducing them at the time, this led to various consequences,” adding, “I will pay closer and more meticulous attention to investor protection and market stability.”
Lee Chan-jin also said, “I always feel heavy-hearted,” and apologized, saying, “I feel sorry to the public here as well.” He added, “I will take this as an occasion to reflect on the role and responsibilities of a financial supervisory body and look back on them with profound remorse.”
Earlier, People Power Party lawmaker Kim Jae-seop said individual investors’ losses had reached 6.3 trillion won since single-stock leveraged products were launched and called on the financial authorities to provide an accountable explanation. He particularly pointed out that people in their 40s and 50s, who are at the center of economic activity, had suffered substantial losses, and said the FSC chairman and FSS governor should feel a heavy sense of responsibility.
Kim criticized the authorities, saying they should not keep responding that they knew nothing about the investor losses, while pointing to the government’s repeated messaging that funds should be shifted from real estate to financial markets. He also stressed that the records of meetings related to the introduction and the decision-making process should be reviewed and responsibility established.
However, in response to criticism that the review had been rushed, Lee Chan-jin said, “We rigorously reviewed each filing and accepted them after 15 days,” adding, “I cannot accept the claim that the review was rushed.” Regarding his earlier remark during an audit of the agencies that “the review was expedited,” he explained, “Normally, a preliminary listing review is conducted before a securities registration statement is filed, but in this case, that did not happen and it came directly to us,” adding, “I was saying that, in that respect, there was an aspect of it being done quickly.”
Calls for Lee Eok-won to apologize continued over the announcement of the listing schedule before the review was complete. When People Power Party lawmaker Park Dae-chul pressed him, saying the FSC, which made the announcement, should admit its mistake, Lee replied, “I understand that the relevant agencies proceeded in compliance with legal procedures.”
[email protected] Lee Jung-hwa Reporter