Two former subsidiaries of Credit Suisse have been fined by South Korea’s financial regulator for violations related to short selling. The Financial Services Commission (FSC) imposed fines of $12.17 million on Credit Suisse AG (now UBS AG) and $7.3 million on Credit Suisse Singapore Ltd.
It has been established that between April 7, 2021, and June 9, 2022, Credit Suisse engaged in illegal “naked” short selling worth $43.4 million. South Korea’s Capital Markets Act prohibits naked short selling, where an investor sells shares without borrowing them or verifying that they can be borrowed.
Similar transactions totaling $25.4 million were conducted by Credit Suisse Singapore Limited during the period from November 29, 2021, to June 9, 2022.
To promote a stable system against illegal trading practices in the future, South Korea has extended the ban on short selling of stocks across the market until the first quarter of 2025