Alphabiz - Prosecutors Expand Probe into Alleged Insider Trading at Meritz Financial Group

Meritz Securities. (Photo courtesy of Meritz Securities)

[Alpha Biz= Kim Jisun] South Korean prosecutors investigating alleged insider trading by executives at Meritz Financial Group have reportedly expanded the scope of the investigation to cover the group’s entire share buyback process over the past five years.

According to financial industry sources on Sunday, the Seoul Southern District Prosecutors’ Office, through its Financial Investigation Division 1, conducted search-and-seizure operations late last month at two major securities firms, including NH Investment & Securities and Samsung Securities.

Prosecutors are reportedly analyzing computers and work records obtained from employees responsible for share buyback operations at the brokerages.

The case initially emerged during the November 2022 merger process involving Meritz Financial Holdings, Meritz Fire & Marine Insurance, and Meritz Securities. At the time, two executives at Meritz Fire & Marine Insurance were accused of trading company shares using non-public information before the announcement of the merger plan and shareholder return measures, allegedly earning hundreds of millions of won each in illicit profits. Financial authorities referred the case to prosecutors in July last year.

After taking over the case, prosecutors broadened the investigation to examine all share buyback transactions carried out between 2021 and 2025, a period of approximately five years. Investigators are reportedly scrutinizing whether internal information was leaked during stages in which detailed buyback schedules and volumes were shared in advance with brokerage firm staff prior to public disclosures, and whether such information led to personal stock trading by executives.

Alphabiz Reporter Kim Jisun(stockmk2020@alphabiz.co.kr)