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Koo Yeon-kyung (left), CEO of the LG Welfare Foundation, and her husband Yoon Kwan, CEO of BlueRun Ventures (BRV). (Photo courtesy of Yonhap News Agency) |
[Alpha Biz= Paul Lee] SEOUL, SOUTH KOREA – The Seoul Southern District Court on Monday acquitted Koo Yeon-kyung, CEO of the LG Welfare Foundation, and her husband, Yoon Kwan, Chief Investment Officer (CIO) of BlueRun Ventures (BRV) Capital Management, of charges involving the use of undisclosed material information for illicit stock trading.
The Charges and Allegations The case, which fell under the Capital Markets Act, involved allegations that CEO Koo purchased 35,990 shares of Mezzion, a KOSDAQ-listed biotech firm, in April 2023. The prosecution argued that Koo acquired the shares (valued at approximately KRW 650 million) after obtaining non-public information from her husband regarding BRV’s plan to invest KRW 50 billion in Mezzion through a third-party allotment recapitalization. The trade reportedly resulted in an unfair profit of about KRW 100 million.
The Court’s Ruling In its judgment, the court addressed the critical issue of when the "undisclosed material information" was actually generated. The presiding judge stated, "It can be viewed that the information regarding BRV’s investment in Mezzion had already been generated around April 12, 2023." This finding was unfavorable to the defendants, who had maintained that the investment was not finalized until after that date.
Despite acknowledging that the information existed at the time of the purchase, the court ultimately delivered a not-guilty verdict due to a lack of direct evidence. The prosecution contended that Yoon had verbally shared the information with Koo while they were staying in Korea following a family trip. However, the court ruled that because the exchange was allegedly oral, the prosecution failed to provide concrete evidence—such as recordings or transcripts—proving that the information was actually communicated.
Post-Trial Incident The trial attracted significant media attention, particularly given the current administration's strict stance on stock price manipulation and insider trading. Following the acquittal, a brief confrontation occurred as CEO Koo exited the courthouse. Swarmed by reporters and intense camera flashes, Koo reacted visibly with frustration, at one point striking a camera. Private security personnel for the couple were also involved in a physical scuffle with members of the press during the exit.
Significance of the Verdict The acquittal underscores the high legal threshold required to prove the communication of insider information between spouses in the absence of digital or physical records. While the court's recognition of the information's timeline may provide grounds for a potential appeal, the lack of direct evidence remains the primary hurdle for the prosecution.
Alphabiz Reporter Paul Lee(hoondork1977@alphabiz.co.kr)
