Korea LIME: Difference between revisions
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LIME Asset Management Co. is a South Korean investment consulting company that was established on March 30, 2012. The company was founded by Jongjoon Won, who was previously a fund manager at Truston Asset Management and Brain Asset Management. In 2015 the company shifted to being operated as a hedge fund management firm. The company quickly developed by a private fund that focused on investment in mezzanine financial products. |
LIME Asset Management Co. is a South Korean investment consulting company that was established on March 30, 2012. The company was founded by Jongjoon Won, who was previously a fund manager at Truston Asset Management and Brain Asset Management. In 2015 the company shifted to being operated as a hedge fund management firm. The company quickly developed by a private fund that focused on investment in mezzanine financial products. It was revealed that Vice-President Jongpil Lee of the company embezzled funds from companies where customer assets had been invested. Lee has not responded to the Persecutor's summons request, and has disappeared. |
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==Issues== |
==Issues== |
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The issue was caused by purchasing a large volume of insolvent assets, including mezzanine of KOSDAQ zombie companies, for increasing the rate of return in the short-term. In Korea there are regulations which limit how many bonds that can be owned by one entity. However, to bypass this regulation, "parking transactions" were done, by making purchases in the name of another company. It is also alleged that when the fund experienced a loss, returns were fabricated by replacing the loss with monies from another fund. |
The issue was caused by purchasing a large volume of insolvent assets, including mezzanine of KOSDAQ zombie companies, for increasing the rate of return in the short-term. In Korea there are regulations which limit how many bonds that can be owned by one entity. However, to bypass this regulation, "parking transactions" were done, by making purchases in the name of another company. It is also alleged that when the fund experienced a loss, returns were fabricated by replacing the loss with monies from another fund. |
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As a result, it was revealed that Vice-President Jongpil Lee of the company embezzled funds from companies where customer assets had been invested. Lee has not responded to the Persecutor's summons request, and has disappeared. |
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On February 19, 2020, the Prosecutor's Office conducted a search and seizure in connection with Shinhan Asset Management and LIME Asset Management. |
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On March 31, 2020, associates of Chairman Kim of Star Mobility were arrested.<ref>https://news.naver.com/main/read.nhn?mode=LSD&mid=sec&sid1=102&oid=025&aid=0002988966</ref> |
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At the end of April 2020, the Financial Supervisory Service carried out a due diligence investigation of Woori Bank and Hana Bank, which sold LIME Asset Management. An additional due diligence investigation of two or three securities companies was also scheduled. |
At the end of April 2020, the Financial Supervisory Service carried out a due diligence investigation of Woori Bank and Hana Bank, which sold LIME Asset Management. An additional due diligence investigation of two or three securities companies was also scheduled. |
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Revision as of 23:07, 28 May 2020
LIME Asset Management Co. is a South Korean investment consulting company that was established on March 30, 2012. The company was founded by Jongjoon Won, who was previously a fund manager at Truston Asset Management and Brain Asset Management. In 2015 the company shifted to being operated as a hedge fund management firm. The company quickly developed by a private fund that focused on investment in mezzanine financial products. It was revealed that Vice-President Jongpil Lee of the company embezzled funds from companies where customer assets had been invested. Lee has not responded to the Persecutor's summons request, and has disappeared.
Issues
In July 2019, LIME began selling convertible bonds of companies listed on the KOSDAQ, and around this time, suspicion arose that the company was maintaining an illegal rate of return. The share prices of stocks that were in the fund run by LIME crashed, and there were concerns of an imminent fund run crises. This led to redemptions being frozen.
The issue was caused by purchasing a large volume of insolvent assets, including mezzanine of KOSDAQ zombie companies, for increasing the rate of return in the short-term. In Korea there are regulations which limit how many bonds that can be owned by one entity. However, to bypass this regulation, "parking transactions" were done, by making purchases in the name of another company. It is also alleged that when the fund experienced a loss, returns were fabricated by replacing the loss with monies from another fund.
Timeline of the Case
On February 19, 2020, the Prosecutor's Office conducted a search and seizure in connection with Shinhan Asset Management and LIME Asset Management.
On March 31, 2020, associates of Chairman Kim of Star Mobility were arrested.[1]
At the end of April 2020, the Financial Supervisory Service carried out a due diligence investigation of Woori Bank and Hana Bank, which sold LIME Asset Management. An additional due diligence investigation of two or three securities companies was also scheduled.