Financial regulator investigates CEO of Meritz Asset Management


Korea time


Financial regulator investigates CEO of Meritz Asset Management

John Lee, CEO of Meritz Asset Management/Yonhap
John Lee, CEO of Meritz Asset Management/Yonhap

By Anna J. Park

The Financial Supervisory Service (FSS) has investigated Meritz Asset Management CEO John Lee over allegations that he breached a conflict of interest obligation when making an investment decision for his company.

According to the FSS, it carried out on-site inspections at the asset management company from May 23 to June 7.

Although the FSS said it could give no further details other than confirmation that the investigation is still ongoing, the financial regulator is known to have launched the investigation after it received a tip that Lee had brought his company to invest in a local peer. to-peer real estate company (P2P) of which his wife is one of the shareholders.

Lee’s wife reportedly invested 200 million won ($155,000) for a 6.57% stake in real estate company P2P, which was founded by an acquaintance of Lee in 2016.

After his wife got the stake in the company, Meritz Asset Management set up a private equity investment fund in 2018, investing 6 billion won in a product from the P2P company. Lee is also chairman of the asset management company’s investment deliberation committee.

The financial authority’s ongoing investigation reportedly focuses on whether the asset management company’s decision to invest in a product of the company, including the wife of the asset management company’s executive ‘assets is one of the shareholders, violates the conflict of interest requirement stipulated in the Capital Market Act.

Some have raised questions about whether Lee could have assumed his wife’s identity to acquire the stake in the P2P company in the first place, meaning he invested with an assumed name. The ongoing investigation would also examine the source of the money invested to clarify whether it came from Lee’s wife or from Lee himself.

Regarding these issues, Meritz Asset Management said there was nothing illegal about Lee’s wife’s investment, adding that the company had submitted all related documents to the financial authority.

In a media interview, Lee also denied the allegations, while acknowledging the facts that his wife is a shareholder of the P2P company, that his acquaintance is the founder of the company, and that Meritz Asset had invested in the company.

“This does not constitute a conflict of interest or an illegal investment,” he said in the interview, saying that the total amount of money invested by Meritz Asset in the P2P company was less than 1% of its income. “The investigation started because of the lies of those who want to slander me,” he said.

A seasoned fund manager who built a successful career in the United States before returning to Korea in 2014 to run Meritz Asset Management, Lee was dubbed the “godfather of small-sum investors” as he preached about his confidence in shares as the best investment tool. , leading many small investors here in the stock market. His YouTube channel has over 470,000 subscribers.


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