South Korea’s Financial Supervisory Service has begun on-site inspections of securities firms’ hub branches, part of an inspection plan it has outlined in its work program.
According to financial authorities on the 23rd, the FSS is conducting an on-site inspection of Hana Securities. The scope covers sales processes at hub branches and other outlets, as well as the head office’s overall internal control system.
The FSS previously said it would expand inspections after checking hub branches at Samsung Securities and Meritz Securities last year. At this year’s briefing on supervision of the investment sector, it said it would move quickly with additional inspections if it finds illegal or improper conduct, or weaknesses in internal controls, during branch reviews. Internal controls at branches and possible mis-selling of high-risk investment products are expected to be key areas of focus.
Industry changes in branch networks are also cited as a backdrop. While the number of branches has fallen, assets have increasingly been concentrated in a smaller number of hub locations, and concerns about internal controls during that shift have persisted. The FSS plans to soon begin an unscheduled inspection of Korea Investment & Securities branches as well.
A Hana Securities official said the FSS had launched an on-site inspection and that the firm understands other brokerages will be reviewed in sequence.
* This article has been translated by AI.
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