Mirae Asset under investigation for suspected inter-affiliate dealings

South Korea's antitrust authority has opened a probe into Mirae Asset Financial Group for suspected inter-affiliate transactions to benefit family owners. The investigation became known to the public on Friday when the business group which owns Korea's largest brokerage house announced that a regulatory review of its new short-term fundraising business filed in July is pushed back due to the ongoing investigation by the Fair Trade Commission (FTC).

Under the current law, regulatory approval of financial business is subject to compulsory adjournment when the company’s majority shareholder is under criminal indictment or investigations by law enforcement agencies.

The FTC said it received a request from financial authorities for an investigation into abnormalities of Mirae’s asset operating unit and its acquisition of Daewoo Securities, adding it is waiting for documents for clarification from the business group.

Mirae Asset Financial Group had been under suspicion for its murky governance structure and inter-affiliate dealings on its way to become Korea’s largest securities company with the combination with Daewoo Securities.

Mirae Asset Consulting involved in management services for real estate assets invested by funds under Mirae Asset Global Investments is owned by the founder’s family with 48.63 percent held by group chairman Park Hyeon-joo and 10.24 percent by his wife. Most of its revenue comes from group-affiliated companies. Other big shareholders of this company are Mirae Asset Capital (19.47 percent) and Mirae Asset Global Investments (32.92 percent). It also runs Mirae Asset Fund Service as a wholly owned subsidiary.

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