Investors who invested in the Optimus Fund filed a lawsuit against NH Investment & Securities, the fund sales company, Hana Bank, the trustee, and Korea Securities Depository, and it has recently been confirmed that the court's ruling on 'multiple liability' was divergent. Previously, a ruling stated that the three institutions, including the sales company and trustee, should be jointly responsible, but recently, a verdict was reached stating that all liability rests with NH Investment & Securities, the fund sales company. Multiple liability is considered a key basis for determining accountability in the largest private fund fraud case in Korea, which resulted in losses amounting to 500 billion won.
According to the legal and securities investment industries on the 27th, the 31st Civil Division of the Seoul Central District Court ruled on February 13 that Nexen had partially won its lawsuit against NH Investment & Securities, Hana Bank, and Korea Securities Depository, seeking the return of 3 billion won invested in the Optimus Fund.
The court ordered NH Investment & Securities to pay 1.5 billion won, half of the investment, to Nexen, while determining that Hana Bank and Korea Securities Depository bore no liability for damages. It did not acknowledge the 'multiple liability' responsibility that the fund sales company, trustee, and management company should share for this incident. Currently, this lawsuit has moved to the second trial as both the plaintiff and defendant have appealed.
The court acknowledged that NH Investment & Securities confirmed the incorporation of public institution receivables into fund assets through the asset statement from Korea Securities Depository before proceeding with the sale. However, it found that NH Investment & Securities violated its obligation to protect investors by not sufficiently assessing the feasibility or risks of the fund, such as not confirming that the receivables were actually secured in the fund.
The problem lies in the fact that, contrary to the asset statement from Korea Securities Depository, the Optimus Fund contained unlisted private bonds. Nexen argued that because Hana Bank also managed the assets of the Optimus Fund as a trustee, it should bear responsibility along with NH Investment & Securities.
However, the court ruled that there was no existing monitoring obligation for the trustee and management company under the Capital Markets Act at the time and did not recognize their liability for damages. While it partially acknowledged that officials from Hana Bank and Korea Securities Depository violated their duty of care, it stated there was no basis for institutional-level responsibility. The court explained in the ruling, 'The claim that the plaintiff (Nexen) asserts regarding the violation of the duty of care seems to be based solely on actions taken by employees, and thus the plaintiff's assertion that Hana Bank and Korea Securities Depository bear employer liability lacks merit.'
This shows a significant discrepancy from the previous ruling on multiple liability. Earlier, GC Wellbeing had also filed a lawsuit against these three institutions, demanding the return of the investment in the Optimus Fund. The court ordered compensation of 1.093 billion won out of the 2 billion won investment as it recognized the multiple liability. NH Investment & Securities, Hana Bank, and Korea Securities Depository should provide compensation together. This ruling was noted as the first case where the court recognized multiple liability related to the Optimus incident.
The court explained its ruling by stating, 'Rather than considering the individual circumstances of the defendants, we need to examine how to fairly distribute the responsibility as a whole, as the interaction of the violations of duty of care by NH Investment & Securities, Hana Bank, and Korea Securities Depository, each assigned roles under the Capital Markets Act, has greatly contributed to the escalation of this incident into a large-scale financial issue.'
The issue of multiple liability is key to determining the compensation level for each institution in this case, where the damages exceed 500 billion won. NH Investment & Securities is currently compensating individual investors in full for their investments and is pursuing a lawsuit for indemnity against Hana Bank and Korea Securities Depository. The results of the lawsuit with institutional professional investors inevitably impact this indemnity claim.
However, the divergent judgments regarding the court's multiple liability have led to increased controversy. The investment industry points out that the lack of a legal monitoring obligation for the fund sales company, trustee, and management company at the time is the biggest issue.
A representative from the investment industry noted, 'At that time, the range of obligations legally assigned to the parties involved in the lawsuit was narrow. This resulted in a difference in perspective between the court, which focused on whether the limited obligations were properly fulfilled, and the court that interpreted broadly considering the implications of the Optimus incident. However, as both cases are currently under appeal for a second trial, it seems likely that both will ultimately converge on a single conclusion regarding the recognition of multiple liability or lack thereof.'
Meanwhile, NH Investment & Securities, which recently received a ruling to bear full liability for damages to Nexen, stated, 'While acknowledging that employees of Optimus Asset Management sent the private bond acquisition contracts of unlisted lending companies requesting that public institution receivables be input, we hold that we bear no legal responsibility, which is the gist of this ruling,' and added, 'We have filed an appeal arguing that we should also bear the duty of care and the obligation to protect investors.'