Samsung Active Asset Management Fund Manager Front-Running Allegations Spread
An exclusive report revealed that a manager who ran a Kosdaq active fund at Samsung Active Asset Management is under investigation by the Financial Supervisory Service on suspicion of personally purchasing stocks in advance of the fund's planned holdings. The fund had drawn attention for marketing an aggressive active strategy that did not simply track the Kosdaq index weighting but instead arbitrarily raised the weight of stocks the manager deemed promising, and it gained market attention as a so-called "Samsung pick" after posting strong returns.
The hosts noted that if the allegations are true—that managers used sophisticated methods such as burner phones and tethering to evade IP tracing while front-running—this would be an extremely serious case, tantamount to front-running the entire market after the fund had disclosed its stock-by-stock weightings. Since the fund industry is ultimately built on investor trust, betraying that trust was assessed as a grave incident that undermines confidence in the asset management industry as a whole.
Calls emerged for disclosure of the manager's real name, an official apology and countermeasures from Samsung Asset Management, and a full compliance investigation of all fund managers. Regarding news that the manager in question had already been replaced, the hosts criticized Samsung's explanation—that the move was for asset management efficiency—as an unconvincing account.
There were also calls to pursue institutional mechanisms that would disclose the identity of fund managers involved in similar incidents going forward, to prevent recurrence. Given that the Kosdaq market involves large numbers of retail investors, there was consensus that this incident must not fade away as a mere one-off episode but should lead to genuine institutional reform.