Court rules Samsung Securities to cover half of investors’ damages in 2018 dividend error


(Yonhap)

A Seoul district court has ruled that Samsung Securities Co. should compensate investors for half of the damages suffered due to a 2018 dividend error due to an accidental issuance of shares, court sources said on Sunday.

The Seoul Central District Court recently ruled in part in favor of three investors who sued the brokerage firm for damages for the “big finger” error caused by a company official on April 6. 2018.

If the ruling is upheld, Samsung Securities must give between 28 million won ($ 23,769) and 49 million won to each investor who sued the company.

The market error occurred when the head of Samsung Securities seized 1,000 shares instead of 1,000 won per share in dividends that were to be paid to employees as part of a compensation plan.

As a result, the company issued 2.8 billion shares that only existed on paper, and some employees who received the shares quickly sold them on the market. Samsung Securities shares plunged about 12% that day.

In its decision, the court pointed out that the brokerage did not have an internal oversight mechanism for the employee stock dividend system and that the mass sale of shares took place in the absence of a plan. emergency crisis management.

Regarding the act of the employees selling their shares at the time, the court said the personal stock transactions appeared to have taken place because they were only pursuing private gain and the brokerage could not not take full responsibility. (Yonhap)


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