FSS Chief Sympathizes with SpaceX Subscription Compensation

Logos of Mirae Asset and SpaceX. Financial Supervisory Service Governor Lee Chan-jin expressed his agreement on Oct. 22 with the point that ‘opportunity costs’ should be compensated for investors whose subscription margins were tied up in relation to the unallocated public offering subscription for SpaceX by Mirae Asset Securities. Governor Lee said during the comprehensive audit of the Financial Services Commission and the Financial Supervisory Service by the National Policy Committee held at the National Assembly in Yeouido, Seoul on October 22, “We will close the on-site inspection today (on Oct. 22) and proceed with the sanction procedures.” People Power Party Representative Song Eon-seok asked, “The subscription amount for Mirae Asset Securities’ SpaceX was a staggering $11.0001 trillion, and the margin alone gathered an enormous amount of money at $795 million, but it is set up so that only institutional or professional investors are able to (deposit the subscription margin).” He added, “There was a monthly average of about 109 professional investors (2022 to 2025), but this increased by 400 people in April of this year, and 734 people registered in June. I wonder if Mirae Asset Securities recommended retail investors to register as professional investors, and I heard the Financial Supervisory Service launched an inspection into this, so has the result of that inspection come out?” Representative Song raised suspicions, stating, “I heard that the second on-site inspection was originally planned to be finalized on July 16, followed by a subsequent inspection on Sept. 14, and scheduled to end on Oct. 8, but it has been extended and is still being conducted (the inspection), which seems like an attempt to merely avoid the period of the national assembly audit, does it not?” To this, Governor Lee replied, “That is not true. Today is the day the inspection ends.” Representative Song argued that Mirae Asset Securities should provide ‘compensation’ to investors by applying at least the Cash Management Account (CMA) interest rate (2.8%) for the period during which the subscription margin of $795.41 million was tied up. He emphasized, “If the Mirae Asset Securities CMA account interest rate of 2.8% is applied to 1.2145 trillion won (about $917.16 million) based on the Korean won, the interest revenue (for Mirae Asset Securities) alone is 372.77 million won.” He added, “They gained this much in foreign exchange profits, fees, and interest revenue, but practically not a single share was allocated, which is essentially the same as committing fraud, so they must provide compensation.” He then asked, “The people who actually entered the public offering subscription broke off funds they could have managed (elsewhere) to enter, and since it is an opportunity cost, shouldn’t they be compensated whether in dollars or in won?” Governor Lee said, “I sympathize with the committee member’s point,” and added, “We will look into that matter.”