Prosecutors Seek 5-Year Prison Term for Accomplice in 30 Billion Won Stock Manipulation Scheme Using ‘New Drug’ Pretense

Evading Responsibility by Using a "Ghost Owner"

Prosecutors have sought a prison sentence for one member of a stock price manipulation ring who, after artificially inflating share prices by pretending to pursue a bio-pharmaceutical new drug business, attempted to evade responsibility by creating a 'ghost owner' once investigations began.

Seoul Southern District Court, Yangcheon-gu, Seoul. Photo by Jiye Lee

During a trial held on June 2, 2026, at the Seoul Southern District Court, Criminal Division 15 (Presiding Judge Noh Yu-gyeong), prosecutors requested a five-year prison term and a fine of 8 billion won for Mr. Lee (43), the CEO of a venture investment company in his 40s, on charges including embezzlement. Prosecutors also demanded the confiscation of 2,533 million won.

Mr. Lee was indicted without detention on charges of conspiring with the real owner of a sand washing and sales company to disseminate false information about a bio-pharmaceutical new drug business, artificially boosting the stock price through wash trades and high-priced buy orders, and thereby gaining illicit profits of over 30 billion won. He is also accused of misappropriating 850 million won of company funds in the course of these crimes.

In his final statement, Mr. Lee completely denied the charges. He stated, "As a company executive, I regret not having sufficiently checked and reviewed the matters at hand," but pleaded, "Please find me not guilty or grant the utmost leniency permitted by law."

An investigation found that Mr. Lee and his associates promoted their company as if pursuing a bio-pharmaceutical new drug business in 2018 and made false disclosures claiming to have attracted investments from prominent overseas funds, obtaining illicit gains worth approximately 19.4 billion won.

When the Financial Supervisory Service launched a full-scale investigation in October 2019, the group responded by fabricating a scenario that identified a fictitious person as the company's actual owner.

The sentencing for Mr. Lee and the other six members of the group will be handed down on July 14, 2026.

This content was produced with the assistance of AI translation services.