Kim Yong-hoon, CEO of Tiger Alternative Asset Management, reported internal misconduct to the Financial Supervisory Service (FSS) end of last month but now faces retaliatory dismissal by the company's major shareholder before any investigation has begun. Kim discovered that former executive Jung illegally held dual positions for two years and used the corporate seal without authorization over 500 times, leading to Jung's dismissal in June. The major shareholder Tiger Asset Management Investment Advisory, which holds a 50% stake, plans to immediately dismiss Kim and reinstate Jung as the new CEO through an extraordinary shareholders' meeting, despite the pending FSS complaint.
Former Executive Jung Violated Conflict-of-Interest Rules for Two Years
Kim conducted an internal review after becoming sole CEO and discovered multiple violations by current and former executives. Former executive Jung simultaneously held the positions of head of management strategy and head of investment division for two years without proper internal approval. This violated the company's obligation to prevent conflicts of interest and block information exchange between departments. Jung was also found to have used the company's corporate seal without CEO approval or authorization on over 500 official documents. Tiger Alternative Asset Management dismissed Jung in June based on these findings.
Major Shareholder Plans CEO Dismissal Before FSS Investigation
Tiger Asset Management Investment Advisory, which owns 50% of Tiger Alternative Asset Management, scheduled an extraordinary shareholders' meeting to immediately dismiss Kim and appoint the dismissed Jung as the new CEO. The retaliatory action began before the FSS investigation commenced. Lee Jae-wan, the former CEO who holds over 99% of Tiger Asset Management Investment Advisory, is reported to be leading this personnel change. Lee received a three-month job suspension from financial authorities in January last year for front-running using undisclosed information, personally profiting approximately 4.1 billion won. The company was also fined 100 million won in institutional penalties for the same incident. Lee recently returned to the same company as investment personnel under a different title.
FSS Delays Investigation Citing Management Dispute Concerns
The FSS stated it will approach the case cautiously due to the potential management dispute between the first and second largest shareholders. An FSS official said the case could be viewed as a management dispute, making it difficult to proceed quickly with an investigation due to concerns about discouraging whistleblowing. The official confirmed no decision has been made and could not provide a timeline for when the investigation might begin. Kim, who is also the second-largest shareholder and co-founder of Tiger Alternative Asset Management, expressed hope for a swift investigation. Kim stated concerns that if dismissed, another person might try to cover up the company's problems. Tiger Alternative Asset Management started in 2018 as the alternative investment division within Tiger Asset Management and became an independent company in 2019, marking the first asset management company established through equity investment by another asset management firm.
FAQ
What misconduct did Kim Yong-hoon report to the FSS?
Kim reported that former executive Jung illegally held dual positions as head of management strategy and head of investment division for two years without proper approval, violating conflict-of-interest rules. Jung also used the corporate seal without authorization on over 500 official documents.
Why is the FSS delaying the investigation into Tiger Alternative Asset Management?
The FSS stated the case could be viewed as a management dispute between the first and second largest shareholders, making it difficult to proceed quickly due to concerns about the complexity of such disputes and potential impacts on whistleblowing practices.
