One-year jail term sought for late LG chair’s daughter in insider trading case

Prosecutors on Tuesday sought prison sentences for Koo Yeon-kyung, the eldest daughter of late LG Chair Koo Bon-moo, and her venture capitalist husband Yoon Kwan, accusing the couple of trading on undisclosed information.

At Tuesday's hearing in the Seoul Southern District Court, prosecutors requested prison terms for both Koo, head of the LG Welfare Foundation, and Yoon, chief investment officer at BRV Capital Management. They asked the court to sentence Yoon to two years in prison and a fine of 50 million won ($33,900) for violating the Capital Markets Act. For Koo, who faces identical charges, prosecutors sought a one-year prison term, a fine of 20 million won, and forfeiture of approximately 156.6 million won in alleged illicit profits.

Prosecutors allege that Koo purchased shares in biotech firm Mezzion after receiving confidential information from Yoon about a planned 50 billion won capital injection by BRV. According to the prosecution, Koo purchased about 35,990 shares of Mezzion listed on the Kosdaq. These were worth roughly 650 million won on April 12, 2023, a week before the investment was publicly disclosed.

The disclosure on April 19 sent Mezzion’s shares up 16.6 percent on the day. Prosecutors allege that Koo had secured about 100 million won in unrealized gains and believe Yoon had provided her with the investment information in advance between late March and April 12, 2023.

Both Yoon and Koo have denied allegations. They argued that the investment had not been finalized at the time of Koo's share purchase, noting that the decision was formally made on April 17, when BRV Capital's investment committee approved the deal.

If convicted, the couple could face at least a year in prison or fines ranging from three to five times the amount of illicit profits, under amendments to the Capital Markets Act that took effect in June 2023, which strengthened penalties for unfair trading practices.