Punishment to be toughened for financial firms over false disclosure

South Korea's top financial regulator said Tuesday it will toughen punishment for financial holding firms over false disclosures of accounting books and other business reports.

Under the toughened rule, which will take effect Oct. 19, fines against financial holding firms will be hiked by as much as 12 times if they violate relevant laws, the Financial Services Commission said in a statement.

Currently, a financial holding firm is required to pay a fine of 5 million won ($4,447) when it violates relevant laws, according to the FSS. This can be raised to upwards of 60 million won. 

(Yonhap)

Hong Seong-ki, an FSS official, said the current financial penalty is too weak to deter inappropriate disclosures of information by financial holding firms.

The toughened rule was approved at a Cabinet meeting earlier in the day, according to the statement.

Another revised rule allows the FSC to take action against retirees of financial holding firms over their past managerial shortcomings. (Yonhap)