Date of Award
Master of Laws (LLM)
Recent financial scandals in South Korea that caused massive harms to financial consumers instigated voices that financial regulators should play a more active role in recompensing victims for losses incurred by misconduct in the financial market. In this regard, this thesis aims to suggest several considerations in developing the compensation scheme for injured financial consumers in Korea. This thesis first reviews the Federal Account for Investor Restitution (FAIR) Fund operated by the U.S. Securities and Exchange Commission. Specifically, it broadly addresses the history, overall process, operation, and major issues related to the FAIR Fund. Based on the FAIR Fund review, this thesis suggests several considerations financial regulators and legislators in Korea should take into account when developing a public compensation system.
In brief, this thesis suggests that public compensation in Korea needs to be considered in conjunction with the strength of monetary sanctions in the financial regulatory arena. It also suggests that policymakers should consider other factors such as the availability of private compensation, the adequacy of procedures, and the regulatory agency’s mission and resources. This study also emphasizes that, in developing a compensation scheme, the focus should be on how the regulators can enhance their compensatory role while maintaining the deterrence effect of securities enforcement actions.
Kim, Daeil, "Enhancing the Compensatory Roles of Financial Regulatory Agencies in South Korea: Lessons from the U.S. SEC's FAIR Fund" (2015). Theses and Dissertations. 17.